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Day's Relief Rally Still In Full Flow, ESA Clears Key Resistance

US STOCKS
  • ESA sees a third wind heading later in the session, hitting new highs of 3916.5 (+2.3%), extending an intraday rally from a low of 3819 10mins before payrolls. It tentatively clears a key resistance level of 3914.41 (50-day EMA), a clear break of which could open 4043 (Dec 15 high).
  • A substantial rally in Treasuries on expectations of less Fed hikes from weaker wage growth before a large miss for ISM Service activity is the main driver for the day’s turnaround, with larger gains in Nasdaq (+2.7%) in a reversal of yesterday’s oversized decline for the latter.
  • SPX gains led by materials (+3.4%) but with sizeable gains across a broad swathe of sectors.

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