Strong Economic Reports Boost U.S. Benchmarks

by Vlad Karpel

Nasdaq lead benchmarks with 1.72% gained

All three major U.S. indices posted gains on Monday, powered by strong economic data released today as well as at the end of last week. This includes March jobs reported, released on Friday, that topped expectations as well as unemployment data, which showed a slight dip last month; the latest services index showed an impressive jump in March that represents strong economic-activity expansion. Following the positive sentiment and data offered by these reports, the Nasdaq lead benchmarks with 1.72% gained while the S&P reached further into record territory, adding 1.5%.

Key reports this week

This week’s key reports include last month’s FOMC minutes, trade deficit, consumer credit, and job openings. Focus remains on the latest economic reports, with earnings season still weeks away, as the latest Federal Open Market Committee minutes are likely to include some additional information regarding the Fed’s stance on the latest moves by the Biden administration. With the $1.9 trillion economic relief passed, and the potential for a large infrastructure program, investors will look to see how the Fed plans to if at all adjust its plans to keep rates unchanged through 2023. Globally, both Asian and European markets finished impressively higher.

 

The $SPY broke above the $400 level following the recent rebound and deteriorating momentum behind treasury and currency markets. The SPY was able to break out above the $400 level across all asset classes and our models are projecting the SPY to trade in the range of $385-$420 for the next 6 weeks. The DXY sold off and the TLT continues to trade in the range. We encourage all market commentary readers to maintain clearly defined stop levels for all positions. For reference, the SPY Seasonal Chart is shown below:

Key U.S. Economic Reports/Events This Week:

  • Markit Services PMI (March) – Monday
  • ISM Services Index (March) – Monday
  • Factory Orders (February) – Monday
  • Job Openings (February) – Tuesday
  • Trade Deficit (February) – Wednesday
  • Consumer Credit (February) – Wednesday
  • FOMC Minutes – Wednesday
  • Weekly Jobless Claims (4/3) – Thursday
  • Producer Price Index (March) – Friday
  • Wholesale Inventories (February) – Friday

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For reference, the S&P 10-Day Forecast is shown below:

Using the “^GSPC” symbol to analyze the S&P 500 our 10-day prediction window shows a near-term mixed outlook. Prediction data uploaded after the market closes at 6 p.m. CST. Today’s data is based on market signals from the previous trading session.


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Tuesday Morning Featured Symbol

Our featured symbol for Tuesday is Microsoft (MSFT). MSFT is showing a steady vector in our Stock Forecast Toolbox’s 10-day forecast.

The stock is trading at $249.07 with a vector of -0.31% at the time of publication.

10-Day Prediction data uploaded after the market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.

Note: The Vector column calculates the change of the Forecasted Average Price for the next trading session relative to the average of actual prices for the last trading session. The column shows the expected average price movement “Up or Down”, in percent. Trend traders should trade along the predicted direction of the Vector. The higher the value of the Vector the higher its momentum.

*Please note: At the time of publication Vlad Karpel does have a position in the featured symbol, MSFT. Our featured symbol is part of your free subscription service. Not included in any paid Tradespoon subscription service. Vlad Karpel only trades his money in paid subscription services.  If you are a paid subscriber, please review your Premium Member Picks, ActiveTrader, or MonthlyTrader recommendations. If you are interested in receiving Vlad’s picks, please click here.


Oil

West Texas Intermediate for Crude Oil delivery (CL.1) priced at $58.79 per barrel, down 4.33% at the time of publication.

Looking at USO, a crude oil tracker, our 10-day prediction model shows mixed signals. The fund is trading at $40.53 at the time of publication. Prediction data uploaded after the market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.


Gold

The price for the Gold Continuous Contract (GC00) is up 0.05% at $1729.20 at the time of publication.

Using SPDR GOLD TRUST (GLD) as a tracker in our Stock Forecast Tool, the 10-day prediction window shows mixed signals. The gold proxy is trading at $159.96 at the time of publication. Vector signals show +0.05% for today. Prediction data uploaded after the market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.


Treasuries

The yield on the 10-year Treasury note is up, at 1.745% at the time of publication.

The yield on the 30-year Treasury note is up, at 2.414% at the time of publication.

Using the iShares 20+ Year Treasury Bond ETF (TLT) as a proxy for bond prices in our Stock Forecast Tool, we see mixed signals in our 10-day prediction window. Prediction data uploaded after the market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.


Volatility

The CBOE Volatility Index (^VIX) is $19.4 at the time of publication, and our 10-day prediction window shows positive signals. Prediction data uploaded after the market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session


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