U.S. markets opened with solid gains to start the week despite the lack of any clear catalyst while finishing mostly higher.

Trade tensions continue to be Wall Street’s main focus and have been providing a headwind for momentum.

Some of the strength came after the U.S failed to impose new tariffs on China over the weekend.

However, President Trump has signaled he’s ready to target more Chinese goods for new tariffs and suggested some U.S. Tech companies could avoid tariffs by moving manufacturing back home.

The Nasdaq snapped a 4-session slide after rising 0.3% and trading to a high of 7,945.

Lower resistance at 7,950-7,800 held with a move above the latter being a bullish signal.

The Russell 2000 climbed 0.3% after trading in a 9-point range while topping out at 1,723.

Resistance at 1,725-1,730 held with continued closes above the latter signaling a possible short-term bottom.

The S&P 500 was up for the first time in 5 sessions after adding 0.2% while trading to a high of 2,886.

Prior resistance at 2,890-2,900 held with a close above the latter signaling additional strength.

The Dow dipped 0.2% after trading to an intraday low of 25,854.

The index managed to clear 26,000 shortly after the open but remains trapped in a trading range between 25,800-26,000 that has now pushed 6-straight sessions.

Real Estate led sector strength after jumping 0.6% while Utilities and Industrials rallied 0.5%.

Health Care and Financials paced sector laggards after giving back 0.3% and 0.1%, respectively. Energy slipped 0.03%.

Global Economy – European markets were higher across the board as traders set aside ongoing worries over global trade while focusing on a win for anti-establishment politicians in Sweden’s election.

The Belgium20 jumped 0.8% and the Stoxx 600 Europe rose 0.5%. France’s CAC 40 gained 0.3% and Germany’s DAX 30 added 0.2%. The UK’s FTSE 100 was up over a point, or 0.02%.

Eurozone September Sentix investor confidence fell 2.7 to 12, weaker than forecasts for a print of 14.3.

Asian markets were mixed following comments from President Trump for a major Tech giant (Apple) to move manufacturing to the United States.

The region is home to many of the the companies key suppliers, especially in China and Taiwan.

Hong Kong’s Hang Seng dropped 1.3% and China’s Shanghai sank 1.2%.

Australia’s S&P/ASX 200 dipped 2 points, or 0.03%. Japan’s Nikkei and South Korea’s Kospi advanced 0.3%.

The China August trade balance unexpectedly shrunk to a surplus of $27.91 billion, narrower than expectations of $31 billion.

August exports rose 9.8% year-over-year, below estimates of 10%, while Aug imports were up 20%, topping forecasts 17.7%.

China August CPI rose 2.3%, above expectations of 2.1%. August PPI came in at 4.1%, topping estimates of 4% year-over-year.

Japan Q2 GDP was revised upward to 3%, stronger than forecasts of 2.6% and the fastest pace of expansion since Q1 of 2016.

August TD Ameritrade IMX came in at 5.82.

July Consumer Credit was at $16.6 billion and above forecasts of $13.9 billion for the month.

Market Sentiment – Atlanta Fed Raphael Bostic said the trade dispute is causing some uncertainty and businesses are likely to pause investments awaiting a clearer picture.

He added tariffs could start to be a bind while saying that the levies could start to push up price pressures.

The iShares 20+ Year Treasury Bond ETF (TLT) showed strength for just the 2nd time in 5 sessions after testing a high of $119.60.

Lower resistance at $119.75-$120 and the 200-day moving average easily held. Near-term support remains at $119-$118.75.

Market Analysis – The Spiders Dow Jones Industrial Average ETF (DIA) tested a morning peak of $260.65 with resistance is at $260-$260.50 getting stretched.

Continued closes above the latter would be a slightly bullish development for a run towards $262.

The intraday fade to $258.86 held near-term support at $258.75-$258.25.

The index has been in a mini-trading range the past 6 sessions with a close below $258-$257.50 leading to a possible breakdown.

RSI is in a slight downtrend with support at 55-50. A move below the latter would be a bearish development. Resistance is at 60-65.

The Utilities Select Spider (XLU) was up for the 3rd-time in 4 sessions following the push to $54.59.

Near-term and lower resistance at $54.50-$54.75 held.

A close above the $55 level would be a more bullish development with upside potential to $55.50 and fresh 52-week peaks.

Support is at $54.25-$54. A close below the latter would confirm a possible short-term double-top.

RSI is back in a slight uptrend with resistance at 60-65.

A move above the latter could lead to a retest of the 70 level and the August highs. Support is at 55-50.

All the best,
Roger Scott