Pfizer (NYSE:PFE) is confident that its potential coronavirus vaccine has satisfied the safety criteria and it will get a green light from the regulators. There is plenty of evidence that fresh capital is being deployed in the stock market and the main theme among money managers is sector rotation—moving into value stocks.
The Asian stock market closed in positive territory as investors cheered Japanese export data. The ASX 200 index closed higher with a gain of 0.50%. The HSI index advanced 0.19%, while the Nikkei index declined by 1.10%. The Shanghai index fell by 0.22%.
Dow Jones and S&P 500: Market Breadth
The Dow Jones’ market breadth weakened yesterday. 87% of the Dow Jones stocks traded above their 200-day moving average. This is a change of -6% from a day earlier.
The S&P 500 stock breadth remained unchanged. 88% of the shares traded above their 200-day moving average. This is a change of 0% from a day earlier.
Dow Jones Futures Today
The Dow Jones futures are trading lower by 121 points today. In terms of economic data, investors will be looking at the Building Permit data, which is due at 14:30 PM GMT. The forecast for the data is 1.57M, while the previous reading was at 1.55M.
The Dow Jones futures have formed the most bearish pattern, a double top, yesterday. This could be the opportunity for the bears to push the markets lower as the RSI has been trading near the overbought zone for some time. In addition to this, the Dow Jones price has also been trading well away from its mean. However, it is important to keep in mind that the price is still above the 50, 100 and 200-day SMA on the daily chart and this means that bulls are in control of the price. The near term resistance is at an all time high while the support is at 29244.
The S&P 500 futures, which represent the broader stock market, are also losing their momentum. The current price action is still trading within the trading range of 3667 to 3506. As long as the price continues to trade between these boundaries, it may be best to buy at the bottom of the range and sell at the peak of this range. Fishing for the exact bottom may not yield the best outcome. Overall, the S&P 500 is still in a strong uptrend as the price is trading above the 100 and 200-day SMA on the daily time frame.
Stock Market Rally
- The S&P 500 stock index declined yesterday; the index fell by 0.48%. The utility sector led the index lower. 9 out of 11 sectors closed lower.
- The Dow index also came off its highs yesterday; the Dow stocks moved the index lower by 0.56%. Six shares rose, 24 shares declined.
- The NASDAQ composite, a tech-savvy index, closed with a loss of 0.21%.
S&P 500 Leaders and Laggards: SL Green and CVS
SL Green (NYSE:SLG) stock contributed the largest gain, advancing 6.28%. CVS (NYSE:CVS) was the largest drag; it dropped by 8.62%. The S&P 500 stock index is up 12% so far this year.
Dow Jones Leaders and Laggards: Boeing) and Home Depot
Boeing (NYSE:BA0 once again contributed most of the gains for the index, it advanced 3.78% while Home Depot (NYSE:HD) was the largest drag, it declined 2.54%.