S&P 500 Forecast: Healthcare Leads US Stocks Higher—NFP Jobs Report Looms Friday

Materials and Healthcare Lead Market Higher as Energy Retreats

The major U.S. stock indices are higher as we near the mid-session on Tuesday. Today’s gains are being fueled by materials and healthcare, while yesterday’s leader, energy, is under pressure. The technology sector also rose to the forefront after several days of weakness.

At 16:44 GMT, the blue-chip Dow Jones Industrial Average is at 49196.13, up 218.95 or +0.45%. The benchmark S&P 500 Index is trading 6914.78, up 12.73 or +0.18% and the tech-weighted Nasdaq Composite is at 23419.33, up 23.51 or +0.10%.

Moderna Surges 7% on BofA Upgrade, Albemarle Jumps 12% on Price Target Hike

Healthcare gains are being led by a 7% rise in drugmaker Moderna after Bank of America Global Research raised its price objective on the stock.

In the materials sector, lithium miner Albemarle surged 12.1% after Berenberg raised its target price to $135 from $75.

Venezuela Reality Check: Oil Majors Retreat on Processing and Investment Concerns

Oil firms eased after solid gains the previous session, pressuring the energy sector. Energy giants Exxon Mobil and Chevron were down 1.2% and 2%, respectively. Although the U.S. oil industry is expected to have access to Venezuela’s huge oil supply, many questions remain before they can be ready to process the type of crude generated by the country. Investors are asking themselves today, how long will the process take, how much investment will it take, and most importantly, who is going to make that big investment.

Market Focus Shifts Back to Friday’s NFP Report as Key Fed Policy Driver

The impact of the events in Venezuela seems to be wearing off with investors shifting their focus back to more traditional market drivers like the week’s key jobs report on Friday. The data will be an important factor in gauging the Federal Reserve’s policy outlook.

U.S. labor market data commands the most attention because Fed Chair Jerome Powell urged caution against further rate cuts at the central bank’s December meeting until there was more clarity on the health of the labor market.

Fed Officials Remain Divided on Rate Path as Data-Dependency Takes Center Stage

The divisive tone of the Federal Open Market Committee (FOMC) continued on Tuesday with Richmond Fed President Tom Barkin saying that future moves should be carefully guided by incoming data, given risks to the central bank’s jobs and inflation goals, Reuters reported. Meanwhile, dovish Governor Stephen Miran said in a Fox Business interview that policy was restrictive and holding the economy back.

S&P 500 Futures Eye All-Time High as Technical Support Remains Intact

Technically, March E-mini S&P 500 Index futures are within striking distance of its December top at 6988.00. This is the last barrier before the all-time high at 7014.00.

The index is being guided higher by pivot price support at 6927.50. The trend is being supported by higher-top and higher-bottom price swings as well as a strong trend line at 6886.75 and the 50-day moving average at 6883.38.

More Information in our Economic Calendar.