[MM_Member_Data name=’firstName’],
U.S. markets were mixed on Thursday’s following a lower open with the Nasdaq lagging into the closing bell before finishing slightly higher. The Dow and S&P 500 also edged higher, along with the Russell 2000, which set another all-time intraday high of 1,489 as the month of September winds down. T
he major indexes are showing nice gains for the month heading into tomorrow’s session. However, Tech has been the weakest link and needs to hold 6,429 during Friday’s session to stay positive for the month.
Materials and Real Estate led sector strength while Consumer Discretionary and Industrials were slightly weak.
Global Economy – European markets traded higher across the board on optimism in the European economic outlook. The Belgium20 and Germany’s DAX 30 climbed 0.4%. The Stoxx Europe 600 closed higher for the 6th-straight session after rising 0.2%. France’s CAC 40 also advanced 0.2% while UK’s FTSE 100 gained 0.1%.
Eurozone September economic confidence rose a more-than-expected 1.1 to 113, a 10 year high.
Asian markets were mixed after Japan dissolved the country’s lower house of parliament, with snap elections expected on Oct. 22nd. Japan’s Nikkei added 0.5% while Australia’s S&P/ASX 200 edged up 0.1%. South Korea’s Kospi was basically flat after closing a half-point higher, or 0.02%.
Hong Kong’s Hang Seng Index fell 0.8% and China’s Shanghai index gave back 0.2%.
U.S. Q2 GDP growth was revised up to a 3.1% rate from the prior 3.0% estimate, as expected.
U.S. August Advance goods trade deficit narrowed slightly to $62.9 billion, from a revised $63.9 billion in July (was $65.1 billion). Exports bounced 0.2% from -0.3%, with imports falling 0.3% from -0.2%.
Initial jobless claims rose 12,000 to 272,000 in the fourth week of September.
The September Kansas City Fed Manufacturing Index Level check in at 17.
Market Sentiment – Kansas City Fed Esther George said further gradual rate hikes are appropriate and the stance of monetary policy is still rather accommodative. She said the U.S. economy is currently in reasonably good shape and has a brighter outlook on global growth.
She added there has been a pick-up in business investment and while there will be a near-term impact from the hurricanes, offsets are projected down the road.
The iShares 20+ Year Treasury Bond ETF (TLT) continued its recent backtest with today’s low tapping $123.97. Fresh support at $124-$123.75 held. Resistance is at $124.75-$125.
Market Analysis- The Spiders Dow Jones Industrial Average ETF (DIA) has traded between $222-$224 for 10-straight sessions with today’s high reaching $223.77. Continued closes above $224-$224.25 would be a bullish development for another leg higher towards $226-$227.50.
A drop below $222-$221.75 would be a bearish signal that could lead to a continued backtest towards $220-$219 and the 50-day moving average. RSI is starting to curl higher and appears headed towards resistance at 70.
The Spider Gold Shares (GLD) have been in a nasty downtrend after peaking north of $128 earlier this month. Wednesday’s drop below the 50-day moving average was a slightly bearish development with current support at $122-$121.50.
There is risk to $120 on a close below the latter. Resistance is at $122.50-$123. The $123 area represents the triple-top breakout in late August with the current backtest getting stretched to nearly oversold conditions.
However, this level needs to clear before GLD can be trusted again. RSI is currently just above the 40 level and is starting to curl higher.
All the best,
Roger Scott