Market Commentary/Looking Ahead
US equities finished higher Monday. Value was a big outperformer vs growth. Energy, Materials & Industrials were the standouts. Communication Services, Discretionary and Technology lagged. Treasuries were mixed with the curve flattening. The dollar was stronger on the major crosses. Gold finished up 0.7%. WTI Crude settled up 2.8%.
- Outperformers: Energy +3.67%, Materials +3.39%, Industrials +2.73%, REITs +2.48%, Utilities +2.23%, Financials +1.94%, Healthcare +1.82%, Consumer Spls. +1.63%
- Underperformers: Communication Svcs. +0.09%, Consumer Disc. +0.30%, Tech +0.34%
S&P futures are up 1.4% following Asian markets trading sharply higher overnight. European markets are also rallying, extending Monday’s bounce. Treasuries are weaker across the curve. The dollar is under pressure vs the major crosses. Gold is up 0.4%. WTI Crude is up 3.3%.
The SPDR S&P 500 ETF (SPY) remains oversold within the context of an uptrend, right at the key support level. While I recognize that tonight could be a catalyst to break the fund from its current range, rather than guess at it, we look to our roadmap. The near-term and important support level is $320, that is the price that coincides with the September lows and the June highs. As long as SPY holds that level, the structure of the uptrend from the March lows remains in place. On the upside, near-term resistance is at the $340 level, above that, and there is room to attack the September highs.