S&P 500 Marks Another Record High on Trade Optimism

S&P 500 Marks Another Record High on Trade Optimism

$DIA, $SPY, $QQQ, $RUTX, $VXX

FLASH: The US stock market began the week higher. The S&P 500 gained 0.8% after being up 1.0% at the start while the tech-heavy NAS Comp rose 1.1% after starting the session with a 1.7% gainer.

The US and China agreed Saturday to resume trade talks and President Trump also offered concessions including no new tariffs and an easing of restrictions on Huawei Technologies, while China agreed to make unspecified new purchases of US farm products.

A now record-setting run of US economic growth enters its 121st month on Monday, sustained by a decade of low interest rates that helped put 22-M Americans back to work.

But the real economic recovery may only be in its infancy, and, if recent history is any guide, it could be approaching a delicate moment.

It was only last year that US GDP caught up with estimates of its potential, surpassing where Congressional Budget Office analysts feel it would have been if the housing bubble had not burst in Y 2007, and the world had not cratered into a deep recession.

The frames when GDP exceeds potential are typically when workers enjoy the greatest wage gains and members of historically sidelined communities find jobs. In recent years, those frames have not lasted long, a fact that Fed and other officials are wrestling with as they weigh possible interest rate cuts and assess just where the US economy now stands.

We are only now making up ground even though the economy has been growing since June 2009, the month the National Bureau of Economic Research marked as the “trough” of the last recession.

The expansion may have notched its record, but it may take a bit of nerve for the Fed to extend a recovery that, in many ways, is only just starting.

It feels like a new world with structurally less global demand and structurally less resilience in our economies. That is the nature of the new world that we are in. It does make it more complicated.

Let’s see…

Monday, the major US stock market indexes finished at: DJIA+117.47 at 26717.43, NAS Comp +84.92 at 8091.16, S&P 500 +22.57 at 2964.33

Volume: Trade on the NYSE came in at 805-M/shares exchanged

Advancing issues outnumbered decliners on the NYSE by a 1.30-to-1 ratio; on the NAS, a 1.21-to-1 ratio favored advancers.

The S&P 500 posted 60 new 52-week highs and 2 new lows; the NAS Comp recorded 119 new highs and 24 new lows.

  • NAS Comp +21.9% YTD
  • S&P 500 +18.3% YTD
  • Russell 2000 +16.4% YTD
  • DJIA +14.5% YTD

HeffX-LTN’s overall technical outlook for the major US stock market indexes is Bullish.

Have a terrific Holiday week.

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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