SHORT TERM: market ends mixed on Q2 GDP, DOW +17
Overnight all the Asian markets were up for the second day in a row. Europe opened lower and closed -0.50%. US index futures were higher overnight and at 8:30 preliminary results of Q2 GDP came in better than expected: -1.0% v -6.4%. This is the first time since 1949 that GDP has contracted for four quarters in a row. The markets gyrated on the news, opened at 985 and rallied to SPX 993 in the opening minutes. At 9:45 the Chicago PMI was released: 43.3% v 39.9%. The market pulled back, despite a drop in the USD, to SPX 983 by 10:00. This pullback from yesterday’s 997 high is another one of those mini 13-15 point pullbacks since this rally began at SPX 869. And, just like the others the market stabilized and started to move higher. By 3:30 the SPX retested the high for the day at 993 before pulling back some into the close. For the day the SPX/DOW were +0.15%, and the NDX/NAZ were -0.40%. Bonds gained one full point, Crude rallied $2.15, Gold rose $15.00, and the Euro moved higher as well. This is the second day in a row that bonds rallied with these other asset classes. Support for the SPX remains at 961 and then 935, with resistance at 990 and then 1018. Short term momentum remained around neutral all day. Interesting day with the surprising improvement in Q2 GDP, decline in the USD, rally in Gold, and the sideways movement in the stock market. Will review all the charts over the weekend. Enjoy your weekend!
MEDIUM TERM: uptrend
LONG TERM: bear market