Falling energy stocks and a surprise jump in the producer price index (PPI) are weighing on this Thursday’s S&P 500 index. The Bureau of Labor Statistics reported that the seasonally adjusted PPI for July 2021 came in at 1.0%, the same as the previous figure but exceeded market expectations. Analysts had predicted a PPI of 0.6%. The weekly unemployment claims data came in at 375K, matching expectations. It was only a marginal drop from the previous figure of 387K.
The surprise PPI figure keeps tapering in the spotlight. Furthermore, the rise in US long-term bond yields favoured financial stocks only marginally. Instead, the Tech index opened lower by 0.35%, although it is slowly erasing these losses.
The Energy index continues to weigh on the index, dropping off by 1.15% as of writing as weaker oil prices continue to dampen oil stocks. The S&P 500 index is marginally lower by 0.02% as of writing and continues to trade just off Wednesday’s all-time high of 4449.44.
Technical Outlook for S&P 500
A break of Wednesday’s ATH at 4449.44 opens the door for the index to aim for the 100% Fibonacci extension of 4453.54, which could serve as the immediate upside target. Above this level, the 127.2% Fibo extension at 4561.95 serves as an additional barrier.