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Equities Roundup: SPX/Nasdaq Lead DJIA Shares

  • Stocks are trading mixed at midday, weaker Dow components vs. carry-over support in SPX and Nasdaq with the passing of the debt ceiling event risk has stocks trading at the highest levels since August 2022.
  • Disinflationary signals from the lowest ISM services data since Dec'22 (May read at 50.3 vs. 52.4 est, 51.9 in April) contributed to positive risk appetite as cooled tighter policy expectations.
  • At the moment S&P E-Mini futures are up 15 points (0.35%) at 4303; Nasdaq up 73.6 points (0.6%) at 13314.15; DJIA down 39.12 points (-0.12%) at 33723.73.
  • Communication Services sector lead gainers at midday, lead by media and entertainment stocks (Netflix +2.45%, Google +1.85%, and Charter Comm +1.15%), followed by Materials and a rebound in Health Care stocks. Meanwhile Industrials, Consumer Staples and Financial sectors underperformed..
  • For a technical perspective, trend conditions for S&P E-minis remain bullish and the contract traded higher Friday. Resistance at 4244.00, the Feb 2 high and a medium-term bull trigger, has been cleared. The break reinforces bullish conditions and confirms a resumption of the uptrend that started in October 2022. This opens 4327.50 next, the Aug 16 2022 high (cont). The 50-day EMA, at 4144.35 remains a key support. A break of this average is required to signal a reversal.

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