S&P 500 started higher the session after President Trump reassured investors that phase one trade deal with China is intact. Trade advisor Navarro in an interview yesterday said that the trade deal is dead sending the stock futures lower by one percent.
On the economic data, Manufacturing PMI came in at 49.6, beating the expectations of 48 in June. The Services PMI registered in at 46.7 topping the forecasts of 46.5, while the PMI Composite rose to 46.8 from previous 37.
The United States Richmond Fed Manufacturing Index came in at 0, better than forecasts of -41 in June. The New Home Sales Change came in at 16.6%, above the expectations of 3.5% in May.
Investors sentiment got a boost from better than expected manufacturing PMI data from Europe. The Germany Markit Manufacturing PMI came in at 44.6, beating the expectations of 41.5 in June. The Services PMI came in at 45.8 also above the expectations of 42, while the PMI Composite registered in at 45.8, the expectations were for 44.2 in June. The France manufacturing PMI also beat the forecast of 46 as it came in at 52.1. In the U.K. the manufacturing PMI registered to 50.1, and the services PMI rose to 47.0 from 29.0. Boris Johnson announced that pubs and restaurants would reopen on July 4.
Trade tensions despite Trump’s confirmation continue to rise. U.S. administration called four Chinese media outlets government agents, including China News Service, CCTV, People’s Daily, and Global Times. The U.S. also threatens to impose a 10% tariff on aluminium products from Canada unless Canada voluntarily restricts exports.
S&P 500 is 0.64% higher at 3143 as the index yesterday tested the 200-day moving average successfully and managed to rebound. The technical picture for S&P 500 index is clearly, and only a break below the 200-day moving average might attract more sellers.
On the upside, first resistance stands at 3156 the daily high (higher high). The next hurdle for S&P 500 will be met at 3189 the high from June 11. In case of a move higher, the bulls will be looking for an extension above 3228 the high from June 8.
On the contrary, initial support for the S&P 500 stands at 3072, the daily low. The next level for the S&P 500 to watch in case of further selling pressure is at 3023 the 200-day moving average. Sellers will take control below the 200-day moving average targeting 2969 the 50-day moving average.