Market Direction: BEARISH alert
issued 11/23/2018
Today was the first day the stock market indicators showed some positive signs of life after 7 weeks of a market downturn. Leave a comment on your
thoughts. Now for the news…
The economy
The S&P 500 gained 3.4% on Friday, as Fed Chairman Jerome Powell signaled patience and flexibility on rates in light of stronger-than-expected jobs data. Friday's gains helped the benchmark index secure a weekly gain of 1.9%.
The Dow Jones Industrial Average (+3.3%), the Nasdaq Composite (+4.3%), and the Russell 2000 (+3.8%) also sported sizable gains to finish the week up 1.6%, 2.3%, and 3.2%, respectively.
All 11 S&P 500 sectors closed the session in the green, with gains ranging from 1.0% (real estate) to 4.4% (information technology). Apple (AAPL 148.26, +6.07, +4.3%), for its part, recouped nearly half of its losses from Thursday.
The major averages began the day on a higher note, helped by optimism surrounding upcoming trade talks with China next week and a robust Employment Situation Report for December.
Specifically, nonfarm payrolls (Briefing.com consensus 180,000) exceeded expectations with an increase of 312,000, while average hourly earnings (Briefing.com consensus +0.2%) increased 0.4%, lifting the year-over-year growth rate to 3.2%.
There were some market concerns about how the Federal Reserve would respond to the strong jobs report. The latest comments from Fed Chair Powell, however, eased those concerns, evident from stocks soaring to session highs -- and maintaining their gains.
Some talking points from the Fed Chair that soothed the market included (1) the Fed will remain patient given the muted reading on inflation, (2) monetary policy will be nimble and shift if necessary, and (3) his softer tone regarding previous comments on the Fed's balance sheet reduction path being on autopilot.
The CBOE Volatility Index (VIX) fell 4.1 points to 21.38, reaching its lowest level since mid-December.
U.S. Treasuries ended the week sharply lower, surrendering their gains from Thursday. The 2-yr yield dropped 10 basis points to 2.48%, and the 10-yr yield dropped 11 basis points to 2.66%. The U.S. Dollar Index lost 0.1% to 96.17.
$tockMarketDirection proprietary model is currently BEARISH. We strongly encourage you to monitor positions closely, exercise proper money management strategies and follow us at $tockMarketDirection for ALERTS we may issue advising a change in the current market direction. Stay tuned and follow us. If you have a testimonial or comment of how this website has helped you we would like to know, write us. Share with a friend.
By the numbers the weekly closing index numbers compared to the initial BEARISH recommendation closing numbers:
Stock Market Closing Numbers
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compared to Recommendation Numbers
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11/23/2018
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1/4/2018
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Difference
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24,285.95
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23,433.16
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852.79
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6,938.98
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6,738.86
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200.12
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2,632.56
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2,531.94
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100.62
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