U.S. stock futures are positive this morning on hopes of a trade deal will be announced at the G20 Summit. Asian markets finished lower, and European markets were only modestly higher. President Trump said he hoped for productive talks with Chinese President Xi Jing but said he had not made any promise on backing off new tariffs.
The S&P 500 broke a four-day losing streak on Thursday and finished higher on low volume. The index has now formed a trading range of 2910.61-2931.50, and the RSI index is also currently in a small sideways range. If the trading can stay within the range for a few days, there may be a chance for a renewed leg higher. If support at 2910.61 is breached, the index could be moving on down to potential support at 2874.68. Trading on Friday could be volatile if any news comes out of the G20 summit today.
The Federal Reserves preferred inflation gauge, Personal Consumption expenditures, rose 0.2% in May while year-over-year came in at 1.5%. Consumer spending was moderately higher, and prices rose slightly, pointing to a slow economy with lower inflation.
We are currently long term bullish and short cautious.
John N. Lilly III
Accredited Portfolio Management Advisor℠Accredited Asset Management Specialist℠
Portfolio Manager, RJ
Partner, Windsor Wealth
The Relative Strength Index (RSI), developed by J. Welles Wilder, is a momentum Oscillator that measures the speed and changes of price movements.
The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the U.S stock market. Past performance may not be indicative of future results. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investors’ results will vary. Opinions expressed are those of the author John N. Lilly III, and not necessarily those of Raymond James. “There is no guarantee that these statements, opinions or forecast provided herein will prove to be correct. “The information contained was received from sources believed to be reliable, but accuracy is not guaranteed. Investing always involves risk and you may incur a profit or loss. No investment strategy can guarantee success. The charts and/or tables presented herein are for illustrative purposes only and should not be considered as the sole basis for your investment decision. International investing involves special risks, including currency fluctuations, different financial accounting standards, and possible political and economic volatility. Investing in emerging markets can be riskier than investing in well-established foreign markets.
The G20 (or Group of Twenty) is an international forum for the governments and central bank governors from 19 countries and the European Union (EU). Founded in 1999 with the aim to discuss policy pertaining to the promotion of international financial stability, the G20 has expanded its agenda since 2008 and heads of government or heads of state, as well as finance ministers and foreign ministers, have periodically conferred at summits ever since. It seeks to address issues that go beyond the responsibilities of any one organization.Membership of the G20 consists of 19 individual countries plus the European Union. The EU is represented by the European Commission and by the European Central Bank. Collectively, the G20 economies account for around 90% of the gross world product (GWP), 80% of world trade (or, if excluding EU intra-trade, 75%), two-thirds of the world population, and approximately half of the world land area.
Personal consumption expenditures (PCE), or the PCE Index, measures price changes in consumer goods and services. Expenditures included in the index are actual U.S. household expenditures. Data that pertains to services, durables and non-durables are measured by the index. Similar to the consumer price index(CPI), the PCE is part of the personal income report issued by the Bureau of Economic Analysis of the Department of Commerce.