U.S. stock futures are set to move lower after an unexpected rise in weekly jobless claims and continued fears of a slowdown in the U.S. economy. Initial claims for state unemployment benefits totaled 898,000 seasonally adjusted for the week ended October 10, compared to 845,000 for the prior week. Treasury Secretary Steven Mnuchin said getting a coronavirus stimulus deal done before the election would be “difficult,” adding to investor’s fear of a stalling economy.
The S&P 500 sold off for the second day in a row closing at 3488.67, which was below old support at 3499.61. The index is now just above a vertical trend line with potential support around the 3840.00 level, and a break of that level could bring on possible intense selling. The trading volume was again only average, with 2.178,062,592 shares traded. Potential resistance remains at 3499.61 if buyers should come back into the market. However, the market appears to be continuing to working off the overbought condition to start the day.
John N. Lilly III CPFA
Accredited Portfolio Management Advisor℠
Accredited Asset Management Specialist℠
Portfolio Manager, RJ
Windsor Wealth Planners & Strategist
Futures trading is speculative, leveraged, and involves substantial risks. Investing always involves risk, including the loss of principal, and futures trading could present additional risk based on underlying commodities investments.
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.