S&P 500 Forecast (SPY) (SPX) (US500): US GDP confuses, so now Apple stock to set direction

Equity markets took a pause on Wednesday as risk appetites were partially sated after the last rally. Equity markets have moved off the lows to the tune of about 10% based on hopes for a Fed pivot. Earnings season continues to reveal that consumers are holding up ok, while corporates are pulling back. This is most clearly visible in big tech with ad spending hitting Alphabet (GOOGL) and Meta Platforms (META), while Visa (V), Pepsi (PEP), Coca-Cola (KO), and a host of others continue to see good pricing pressure pass through. It appears to confirm this is the inflationary slowdown phase of an impending inflationary recession.

S&P 500 (SPY) (SPX) (US500) news

Overnight META has put another spanner in the works with it slumping alarmingly. Earnings were not so bad with an actual revenue beat, but the outlook for costs and margins led to the sharp sell-off. Now only Apple (AAPL) and Amazon (AMZN) await to stem the tide of dismal tech earnings. All eyes though will turn to the macro side of the equation first when we get US GDP. The latest data of 2.6% is just about in-line to ensure plenty for both hawks and doves to argue over.

All eyes now turn to Apple earnings after the close. Is the iPhone 14 selling well or not, and how are margins holding up? We also get Amazon after the close. So far the market appears dovish in my view for the ECB, and yields and the euro are moving down. Meanwhile, oil is higher on the in-line US GDP figure. For stocks, this means more indecision and a likely pause until Apple. The current trend appears to be consumer companies good and big tech bad. Apple is a bit of both but for the high-end consumer.

S&P 500 (SPY) (SPX) (US500) forecast

The double top and resistance at $389 for SPY remain in place. The pivot is at $379 for this rally. Apple stock is likely to see a retracement day continue as META weighs on sentiment. 

SPY daily chart

SPX daily chart