The U.S. stock market seems poised for a constructive start to today’s session, as we head into a new week on Wall Street. As we were preparing this piece, the S&P 500 Index futures were ahead roughly 13 points (0.3%) in pre-market trading. This week, investors will receive a key inflation report, as well as the latest monthly employment numbers.
In the economic arena, today should be relatively quiet, with no major reports scheduled. Tomorrow, the Conference Board will publish the Consumer Confidence Index for the month of August. Traders will be paying close attention to this issuance, given that the consumer plays a vital role in the nation’s economy. Later in the week, a couple of important economic reports will be published. On Thursday, we will get a look at the PCE (Personal Consumption Expenditures) Price Index for the month of July. This key measure of inflation showed prices increased about 3% in June (year over year). However, additional progress will likely be needed this month in order to satisfy the Federal Reserve. On Friday, the government will release the August employment report. Most analysts expect the numbers will show that roughly 165,000 jobs were added to the economy during the month, down slightly from the July figure.
Elsewhere, a few notable companies will issue reports in the days ahead. On Tuesday, Best Buy (BBY), a leading electronics retailer, will deliver its quarterly figures. Later in the week, we will hear from Salesforce (CRM), which is a member of the Dow Jones Industrial Average. Broadcom (AVGO), an important technology company, will also weigh in with its numbers.
From a technical perspective, the S&P 500 Index started to pull back at the start of August, and lost further ground as the month progressed. At this point, the market seems to be looking for support. However, the broader average is currently below its 50-day moving average (located near the 4,460 mark). Clearly, pushing stocks back above this technical level will be a critical feat for the bulls. From a sector vantage point, the technology issues have provided market leadership up until now. It remains to be seen if traders will continue to favor this group, or if some sector rotation will take place, and capital will move into other parts of the market. – 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.
