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S&P 500 Index Marginally Lower On Disappointing Retail Sales Data

Dow Jones
Dow Jones

The S&P 500 index is marginally lower on the day after tepid US retail sales figures failed to lift the markets. The US Retail Sales came in at 0.3%, while the US Core Retail Sales also posted the same number. Both sets of monthly data met the market expectations of 0.3%. However, the previous data for the monthly US Retail Sales were revised downwards to 0.6% for the core component of the report and 0.2% for the leading retail sales figure. The news failed to lift the US markets, which are trading slightly lower on the data. 

Also helping to cap prices on the S&P 500 Index is the news that Tesla’s widely expected stocks sales were going to be done at a significant discount. As at the time of writing, Tesla was 2.6% lower in premarket trading. 

There is also widespread divergence on the outlook of the market as a result of the coronavirus infection. China has changed the methodology for diagnoses of coronavirus cases. Zeng Yixin, Deputy head of China’s Health Commission said today in a press conference covered by a Financial Times Correspondence that so-called “asymptomatic carriers” (those who have the virus without showing clinical illness) were excluded from the tally of cases. 

The coronavirus outbreak continues to be a significant market mover and is defining the risk sentiment guiding the S&P 500. 

Read our Best Trading Ideas for 2020.

Technical Outlook for S&P 500

The S&P 500 futures chart shows that the RSI has made a failure swing, defining lower highs at the same time that the asset is showing higher highs. The bearish action on the day gets some confirmation from the divergence signal. 

At 3379.4, the S&P 500 index is set for a lower open, with the pinbar formed by yesterday’s daily candle setting the stage for a possible downside push towards initial downside target at 3354.5. Below this level, the S&P 500 could find support at 3335.7 and 3299.7, in that order.

On the flip side, the only barrier to further upside movement is the all-time high price of 3389.2. A break of this level by renewed upside movement allows the asset to target new highs.