S&P 500 (SPX) still magnetized to 4,000
- S&P 500 likely to open lower on Monday.
- Shortened week ahead of Thanksgiving on Thursday.
- FOMC minutes on Wednesday is the data highlight.
The market on Monday looks set to open modestly lower as worries over China continue to weigh on global markets. The sell-off in oil is continuing this morning, and bond markets are yielding lower as growth fears continue to dominate.
S&P 500 (SPX) news
Retailers will take center stage again after having a largely positive time last week. Walmart, The GAP and others posted strong earnings, while Target did miss the target. That was probably the only retailer to disappoint. This week we have Dollar Tree, Best Buy and Dicks Sporting Goods. Overall, it seems the US consumer is holding up well. It is, of course, a shortened week, so that either means it is a pretty dull one or investors will rush to get a week's worth of work done in three days with volumes and volatility kicking up a notch. For now, it seems like the former. Oil stocks will come under pressure from the slide in oil prices and Goldman Sachs cutting its forecasts for 2023.
S&P 500 (SPX) forecast
China's covid cases have risen steadily since the reopening trade was ignited, and now over the weekend we get news of the first covid deaths in over six months in China. That set a risk-off tone for Asia, which was largely followed through to Europe. Option expiry last Friday has removed the range, and so this week is freer to see where risk takes us. The 3,900 highlighted below on the hourly chart is the short-term support, and a break is likely to test 3,806. That is the medium-term pivot.
SPX daily chart
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Author
Ivan Brian
FXStreet
Ivan Brian started his career with AIB Bank in corporate finance and then worked for seven years at Baxter. He started as a macro analyst before becoming Head of Research and then CFO.
