S&P 500 has pulled back after closing Monday’s session at slightly above 4,080. The index surpassed the 4,000 mark on 1st April for the first time. The surge has been facilitated by strong economic data and the overall optimism regarding the speedy recovery of the US economy.
On Friday, nonfarm payrolls for March came in better-than-expected at 916,000. The figure beat the estimate of 647,000 and the prior month’s 468,000. Besides, unemployment rate in the US was at 6.0% compared to the previous 6.2%.
Better-than-expected numbers in the service industry have also fuelled the rally. On Monday, the ISM non-manufacturing PMI reading was at 63.7 compared to the forecasted 59.0 and prior month’s 55.3. Investors now wait to see if February’s job openings number will beat the predicted 6.995 million.
Gains in technology shares have further boosted S&P 500. Apple, Amazon, and Microsoft were up by 2.36%, 2.08%, and 2.77% respectively. Tesla has also seen its shares rise by 4.43% after its record delivery of 184,800 vehicles in Q1’21.
S&P 500 Technical Outlook
S&P 500 has pulled back after closing Monday’s session at slightly above 4,080. On Tuesday, the index was down by 0.37% to 4,064.6. On a 3-hour chart, it is trading above the 20 and 50-day exponential moving averages. It surpassed the 4,000 mark on 1st April for the first time. Despite the easing, the outlook remains bullish.
In the near term, S&P 500 is likely to drop to around $4,040. This will be the support-turn-resistance level, after which the index will resume its upward momentum. On the upper side, the next target will be 4,120. On the flip side, a breakout past 4,040 on the downside will have the bears testing the psychological mark of 4,000 and the lower support level of 3,960.