By ForexTime
Note that the SPX500_m posted a closing price on Friday (October 27th) that was 10.3% lower than its closing price registered on July 31st (its year-to-date high).
Furthermore, the SPX500_m is set to post a third straight month of declines – something not seen since Q1 2020 at the onset of the pandemic.
Here’s how this blue-chip stock index has fared recently:
Free Reports:
This is when the US government reveals how much new debt it has to sell to markets to keeping funding its budget.
To underscores the sheer importance of this upcoming announcement for global markets, note how the prior quarterly refunding announcement on August 2nd sparked a rout in US bond markets, setting 10-year US Treasury yields on the way to hitting 5% for the first time since 2007!
At the same time, the S&P 500 has been on a steady decline since that last announcement in early August.
This is because, higher yields on US Treasuries (deemed to be the “safest” investment in the world) makes riskier assets, such as stocks, less appealing.
For this week’s announcement, markets expect US$114 billion worth of securities to be outlined for sale by the US Treasury.
POTENTIAL SCENARIOS:
To be clear, the Fed is roundly expected to leave its benchmark rates unchanged this week.
Furthermore, Fed Chair Jerome Powell is also set to reiterate his “higher for longer” message, which is something that markets are fully aware of.
POTENTIAL SCENARIOS:
Apple has a market cap of US$2.63 trillion, making it the world’s most valuable company.
Apple alone accounts for about 7% of the total S&P 500, making it the largest stock on this benchmark index that is tracked by our SPX500_m.
Given Apple’s sheer size, how markets react to its earnings would have a large influence over how the S&P 500 performs.
Keep in mind that Apple is facing its longest sales slump in over 20 years, and is now facing slowing sales of its iPhone 15 in China.
Hence, both its backward-looking Q4FY23 numbers, as well as forward-looking statements especially around Chinese sales, could dictate how Apple’s share prices react.
Also, Apple’s share price is expected to move by 3.77%, either upwards or downwards, on Friday, November 3rd – the day after the company unveils its financial results for the July-September period (the fourth quarter of the company’s 2023 fiscal year).
POTENTIAL SCENARIOS:
As is the case on the first Friday of most months, markets are eagerly anticipating the tier-one US nonfarm payrolls report.
Here are the current forecasts for some of October’s key figures:
POTENTIAL SCENARIOS:
Such expectations could heap more downward pressure on the SPX500_m.
Such expectations may spark joy among SPX500_m bulls (those hoping prices will go up).
At the time of writing, the SPX500_m is seeing a technical rebound, as its 14-day relative strength index attempts to recover from the 30 line which denotes “oversold” conditions.
However, this technical rebound may prove short-lived, and bulls would need a fundamental catalyst to push the SPX500_m higher going into November.
POTENTIAL RESISTANCE:
POTENTIAL SUPPORT:
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