NASDAQ Index, SP500, Dow Jones Forecasts – SP500 Tests New Highs As Producer Prices Fall

SP500

SP500 gained ground as traders reacted to PPI report, which indicated that PPI declined by -0.5% month-over-month in April, compared to analyst forecast of +0.2%. Core PPI decreased by -0.4%, while analysts expected that it would increase by +0.3%. Treasury yields moved lower as bond traders bet on dovish Fed after the release of Producer Prices data. Today, traders also had a chance to take a look at the Retail Sales report for April. The report showed that Retail Sales grew by +0.1% month-over-month, while analysts expected that they would remain unchanged. Retail Sales Ex Autos increased by +0.1%, compared to analyst forecast of +0.3%. Initial Jobless Claims report showed that 229,000 Americans filed for unemployment benefits in a week, in line with analyst consensus. From a big picture point of view, the job market stays strong. NAHB Housing Market Index declined from 40 in April to 34 in May, compared to analyst forecast of 40. Trade wars put material pressure on the index. Utilities, real estate, and consumer defensive stocks were among the biggest gainers today, which indicated that traders were cautious after the strong rally from April lows.

In case SP500 manages to settle above the resistance at 5910 – 5920, it will head towards the next resistance level at 6000 – 6010.

NASDAQ

NASDAQ is mostly flat as traders take some profits off the table after the strong rally. Cisco, which is up by 5%, is the biggest gainer in the NASDAQ index today. The stock gained ground as traders reacted to the strong earnings report.

A successful test of the resistane at 21,450 – 21,500 will push NASDAQ towards the next resistance at 21,950 – 22,000.

Dow Jones

Dow Jones moved higher despite the continuation of the sell-off in Unitedhealth Group stock. Unitedhealth Group is down by 11.7% as the company is under criminal probe for Medicare fraud.

If Dow Jones settles above the 42,300 level, it will head towards the resistance level at 42,700 – 42,800.

For a look at all of today’s economic events, check out our economic calendar.