US stocks flat as investors wary ahead of Trump-Xi summit
|The US equity markets witnessed a subdued opening on Thursday as investors remained wary of the Trump/Xi Jinping summit, where a bitter outcome could spook global financial markets. Moreover, worries over the Federal Reserve's plan to shrink its $4.5 trillion balance sheet this year was also seen weighing on investors sentiment.
At the time of writing, all the three major indices traded near break-even levels and struggled to gain any traction despite of previous session's sharp reversal following the release of FOMC meeting minutes. However, a larger-than-expected drop in the US weekly jobless claims, pointing to the underlying strength in the US labor market, was seen lending support and limited any follow through downslide.
Apart from the outcome of Trump/Xi meeting, investors on Friday will also focus on the keenly watched US monthly jobs report for March, with consensus estimates anticipating a slow down after two months of strong gains.
Technical outlook
Carol Harmer, Founder at charmertradingacademy.com notes, "the level the actual cash session needs to break is 20611...and hold below there...If we can do that there is a good chance that the market will come down to the lows again of today....currently we have 20570 as the lows....Now the interesting point is if we break below here...If we do...then there is scope for the market to come even lower to 20528 then 20435.... Now this does all depend on whether or not we can stay depressed below yesterdays lows... We know ...from yesterday that the strategy remains...selling strength...towards the 20850/20880 area...and if executed stops to be placed above 20925...."
"Technical indicators still call for the market to come lower....although we are at quite neutral levels....and from 21169 to 20412 we have had quite a move lower....All eyes on this intersecting trendline again....up at 20880 area....." she added.
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