The U.S. stock market seems poised for a constructive opening this morning, as a new week on Wall Street begins. As we were publishing this report, the S&P 500 Index futures were up roughly 69 points (1.20%). Futures for the Dow Jones Industrial Average and NASDAQ were also indicating healthy gains. In the coming days, investors will receive a handful of economic reports, including a key inflation reading. A few corporate profit reports should also warrant some attention. However, the Trump Administration’s plan to implement tariffs on various international trading partners will likely be the main area of focus for investors.
In economic news, there are a number of important items scheduled this week. Tomorrow, The Conference Board will release the March Consumer Confidence Index. This report should be closely followed by investors who have started to express concerns that the consumer is over extended and may soon falter. On Thursday, the final revision to fourth-quarter GDP (Gross Domestic Product) will be published. The numbers are expected to show that the U.S. economy expanded at an annualized rate of 2.3% during the quarter, in line with the prior estimate. It should be noted that a weaker-than-anticipated figure could potentially cause market volatility. Meanwhile, the main event this week will take place on Friday when the PCE (Personal Consumption Expenditures) Price Index is released. Most analysts think prices rose roughly 2.5% during the month of February, year over year. The Federal Reserve pays careful attention to the PCE report, which gives this issuance some extra weight.
In the corporate arena, investors will receive a handful of quarterly profit announcements in the coming days. This afternoon, we will hear from KB Home (KBH), a leading home builder. Later this week, Jefferies Financial Group (JEF), a diversified investment firm, and Lululemon (LULU), a manufacturer of upscale yoga apparel, will weigh in with their numbers.
The stock market may be looking for support at this juncture. Over the past few days, the selling has been less intense, and we have even seen a few constructive sessions where buyers have started to take action. However, traders that adhere to technical systems may require further evidence that the market is firming up. For instance, the S&P 500 Index is still sitting below its 200-day moving average (located at the 5,750 mark). Pushing equities past this technical level would most likely be viewed as a major accomplishment for the bulls. – Adam Rosner
At the time of this article’s writing, the author did not have positions in any of the companies mentioned.
CLICK HERE for more information on our services or call 1-800-VALUELINE (1-800-825-8354). Our account managers are available Monday through Friday, 8:00 AM to 6:00 PM Eastern Time.
