Stock market breadth gain momentum, unemployment claims data ahead

Stock Market Today

The Federal Reserve Minutes confirmed yesterday that there is a strong need for additional stimulus aid package. Traders also believe that there is a strong likelihood that the Fed may need to alter their asset purchase program. This means the Fed may have to either extend their asset purchases, or the period of asset purchase until full employment is achieved.   

Over in Asia, the stock market had another mixed session. The Shanghai index dropped 0.21%. The HSI stock index also moved lower by 0.65%, while the Korean Kospi soared 0.57%. The Nikkei index increased by 0.95%.

Dow Jones and SP500: Market Breadth

The Dow Jones’ market breadth continued to improve. 70% of the Dow Jones stocks traded above their 200-day moving average yesterday.  

The S&P 500 stock breadth also gained further momentum. 67% of the shares traded above their 200-day moving average yesterday. This is a change of +3% from a day earlier. 

Dow Jones Futures Today

The Dow Jones futures are trading higher by 105 points. Today, we are going to get another fresh reading for the U.S. Unemployment Claims data. The forecast is for 820K against the previous reading of 837K. If the number comes in stronger than expected, it is likely to boost the optimism among investors concerning the U.S economic growth. However, a weak reading is likely to dishearten investors.

Should You Buy or Sell Stocks?  

The Dow Jones futures have surprised investors once again as the price has broken above the 50-day SMA on the daily time frame. On Tuesday, the price fell below the 50-day moving and the Dow was looking bearish. The fact that the Dow’s price is trading above the 50, 100 and 200-day SMA on the daily frame, it confirms that bulls have fully taken over once again and the path of least resistance is to the upside. 

The S&P 500 futures, the wider representation of the U.S. equity market, made a major comeback today. The S&P 500 price is trading above the previous week’s high and is challenging its downward trend line. The S&P 500 index is trading above the 50, 100 and 200-week simple moving average on the weekly time frame. The RSI is still not near the overbought zone, and this means the upward momentum for the S&P 500 can continue.

Stock Market Rally

The S&P 500 stock index regained lost ground, the index advanced 1.20%. The material sector led the index higher, as all the 11 sectors closed higher. 

The Dow index has become the leading index for a change, and the Dow stocks moved the index higher by 1.98%. All 30 shares of the Dow closed higher. 

The NASDAQ composite, a tech-savvy index, increased by 1.95% yesterday. 

SP 500 Leaders and Laggards: Alexion, CBOE

Alexion stock contributed the biggest gain, soaring 7.07%. CBOE stock was the largest drag; it fell by 2.04%. The S&P 500 stock index is up 1.53% during the past 5 days.

Dow Jones Leaders and Laggards: Salesforce and Goldman Sachs

Salesforce stock advanced higher by 3.91%, and was the biggest mover for the Dow, while Boeing stock dropped 5.98%, the biggest drag for Dow Jones industrial average index.