Stock indices looking to recover from Wednesday’s declines
US Q1 GDP: 3.1% vs 3.2% prior
2800 remains a key line in the sand for S&P500
There’s been a bit of a recovery in US benchmarks so far today ahead of their cash session. Wednesday saw declines in the region of around 1% across the 3 large-cap US indices with the S&P500 falling to its lowest level since the middle of March. The gains so far today have seen some of the ground lost regained, but the markets remain below there breakout levels and a failure to get back above them before the closing bell could be seen as an ominous sign going forward.
There’s been a batch of US data released in the past hour with the latest economic growth figures the most headline-grabbing. The Preliminary GDP Q/Q came in at an annualised rate of 3.1%, slightly above the 3.0% expected but at the same time marking a drop from the 3.2% seen on the first reading. Looking at the breakdown personal consumption edged higher from the initial reading (1.3% vs 1.2% prior), consumer spending on durables was less negative (-4.6% vs -5.3% prior) but business investment did pullback (2.3% vs 2.7% prior).
After two readings the Q1 GDP sits at 3.1% and remains not far from its highest level in ten years. Source: Bloomberg
The S&P500 is around 20 points off Wednesday’s low of 2765 ahead of the US session. The region around 2800-2805 could be seen as pivotal going forward with the break below there remaining valid unless price returns back above the level. Source: xStation