S&P 500; US Indexes Fundamental Forecast – September 1, 2016

Position-squaring ahead of Friday’s major U.S. Non-Farm Payrolls report and sharply lower crude oil prices helped drag down the U.S. stock indices on Wednesday. The Dow Jones Industrial Average cash market lost more than 100 points at one time before setting about 50 points lower.

The benchmark S&P 500 Index was down about 0.25 percent. Sharply lower energy and material sectors put most of the pressure on the market. Both were down about 1 percent. The technology driven NASDAQ Composite fell about 0.2 percent.

At the end of the day, the Dow had ended a six-month winning streak, the S&P snapped a five-month winning streak and the NASDAQ rose 0.99 percent in August.

Oil prices took a hit on Wednesday after the U.S. Energy Information Administration’s weekly report showed a build of 2.3 million barrels the week-ending August 26. Other reports included a private sector jobs forecast by ADP, pending home sales and Chicago PMI. The ADP report showed the private sector of the economy added 177,000 jobs in August versus a forecast of 175,000.

The ADP report didn’t contain any surprises and didn’t really give investors any indications about Friday’s jobs report. The Chicago PMI report came in at 51.5, lower than expected, but didn’t really rattle the markets. This loss may have by a 1.3 percent rise in July in pending home sales.

Despite Wednesday’s lower close and the lower close for the month, the September E-mini S&P 500 Index futures contract finished the month range bound. This is because of the bullishness caused by the injection of new stimulus and the bearishness caused by overvaluation and the possibility of an interest rate hike before the end of the year by the Fed. Friday’s jobs report should help us clarify the Fed’s position on interest rates.

FxEmpire provides in-depth analysis for each asset we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports, which covers the current week and are published by Sunday before the new week begins. Daily we share any new events, forecasts or analysis that affect the current day. To achieve a full accurate understanding it is important that you study all of our data and analysis as a whole.

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Thursday, September 1, 2016

Government Bond Auctions

Date/Time Country Type

Aug 31 11:05 Norway Holds bond auction

Aug 31 11:30 Germany Eur 4bn Sep 2018 Schatz

Sep 01 10:30 Spain Holds bond auction

Sep 01 11:30 UK Jul 2022 Gilt

Sep 01 11:50 France Holds bond auction