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S&P500 on Track to Entirely Erase 2022 Weakness

EQUITIES
  • Following a test of the contract and alltime highs overnight, markets rejected the level (4841.50) to revert lower and sit in negative territory ahead of the final cash equity open of the year. Resultingly, futures point to a lower cash open in ~10 minutes time, but losses are seen as very moderate from these levels.
  • Depending on performance today, the S&P 500 looks to chalk up gains of over 24% on the year (Dow Jones +13%, NASDAQ 100 +55%, Russell 2000 +17%), recouping the entirety of the 2022 weakness but stopping just short of the better performance posted in 2021 and 2019.
  • The bullish theme in the e-mini S&P remains intact and this week's fresh trend highs reinforce current conditions. The move higher confirms once again a resumption of the uptrend that started Oct 27. Sights are on 4854.75 next, a Fibonacci projection.
  • VIX futures remain subdued, with UXA having printed a new multi-year low of 13.9 in Thursday trade, Focus for final day of trade for this year turns to MNI Chicago PMI 15 minutes after the bell, at which markets expect the gauge to moderate to 50.0 from 55.8 previously.
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com

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