S&P 500 trades on positive foot but off the daily highs after a short test of the 50-day moving average. Disappointing news for the Gilead drug that many hoped might prove to be more effective against the Covid-19 virus weighs on investors’ sentiment. Earlier reported that orders for durable goods dropped 14.4% in March amid the coronavirus crisis the consensus was for an 11.9% decline. University of Michigan consumer sentiment for April came in at 71.8 from 89.1 in March; the expectations were for 71. The Current Economic Conditions Index dropped to 74.3 from 103.7 in March while the Index of Consumer Expectations dropped to 70.1 from 79.7 in February.
Yesterday the Labor Department reported that initial jobless claims jumped by almost 4.4 million, lower than the 5.0 million increase that had been forecasted. Initial jobless claims now top 26 million over the last five weeks.
Investors also follow the earnings reports from American Express (AXP), which reported Q1 profit above the expectations, but the revenue came short of expectations. Intel (INTC) reported stronger than expected earnings and revenue for the first quarter. Next week Alphabet will release the first-quarter earnings. Here you can find the Alphabet (GOOGL) Q1 earnings expectations.
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S&P 500 Support and Resistance
S&P 500 is 0.36% higher at 2,800 in a volatile session as the index attempts to break above the critical 50-day moving average. Early on the week the index failed to break above the 50-day moving average and retreated below. The technical outlook is neutral for the short term as the index lost the positive momentum from the Parch lows, while the long term picture remains bearish below the 50-day moving average.
On the upside, first resistance for the S&P 500 index will be met at 2,818 the daily high. The next level to watch is at 2,874 the high from April 20 trading session. A close above will give bulls the upper hand, and an attempt to 2,968, the high from March 9 will be the next target.
On the flip side, the daily low at 2,761 will provide the first support for the S&P 500 index. A break below 2,761, might open the way for 2,719 the low from April 15 trading session. If bears breach that level, then the next support stands at 2,620 the low from April 8.
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