Upbeat retail sales data and positive news from Pfizer about its coronavirus vaccine are helping to drive the S&P 500 index higher this Friday.
After three successive losing sessions, the S&P 500 bounced back to winning ways after the US retail sales data showed a 1.5% monthly growth in September. This figure beat the consensus of 0.4% and the previous figure of 0.5% (a downward revision). Core retail sales also grew 1.9% in September, which beat the last figure of 0.6% and the consensus figure of 0.7%.
Downbeat industrial production data did not impact the S&P 500 index, which also got uplift from positive coronavirus vaccine news from Pfizer.
The company, which is developing a coronavirus vaccine candidate along with BioNTech, said that it would apply for emergency use of this potential vaccine as early as November 2020. The drugmaker said it would send it in the data on the vaccine’s safety profile and put in the application for authorization as well.
The S&P 500 index is up by 0.45% on a day of low volume trading, even as the upside struggles to attain Monday’s high. However, there is still a chance that the index may end the week marginally higher if things stay the way they are.
Technical Outlook for S&P 500
The index is off intraday highs at 3515.8, as the index struggles to attain the 3528.9 resistance target. Above this level, the all-time highs at 3588.1.
Failure to hit the all-time highs or even Monday’s high indicates a further stall in the recovery on account of progressively declining price peaks. This could put the 3481.6 price level under pressure. If a breakdown occurs, it could force a price move towards 3393.5 or 3333.5, depending on the extent of the decline.
Dow Jones ended 2.32% higher at 25,595 after the index tested and bounced from the 50-day moving average. The index rejected several times the last two weeks at the 200-day moving average. The short term picture has improved after yesterday’s gains, but the long term outlook remains bearish below the 200-day moving average.
On the upside, first resistance for the Dow index stands at 25,601 the high from yesterday. A move above 25,601 might open the way for a test of 25,027 the high from June 24. If the bulls continue then the next supply zone for the Dow Jones is at 26,274 the 200-day moving average.
On the flip side, immediate support for Dow Jones index is at 25,096 the low from yesterday. Next support for the Dow Jones will be met at 24,952 the 50-day moving average. A break below 24,952 might open the way for a test of 24,755 the 100-day moving average.
S&P 500 Daily Chart