Last Week's Close
E-mini S&P 500 (March): Settled at 3817.50, up 22.00
E-mini Nasdaq-100 (March): Settled at 13,097.25, up 169.25
U.S. benchmarks ripped into Friday's settlement. The S&P hit a fresh record high ahead of the close and finished 1.1% from its afternoon low after holding support levels. The risk-environment was first hit by Nonfarm Payroll printing a job loss of 140,000 for December. It’s important to note that November payrolls were revised higher by 91,000 and a surge in Average Hourly Earnings, although a positive headline, was due to seasonal workers falling off payrolls. However, the Unemployment Rate remained steady at 6.7% when it was expected to tick up to 6.8%. We believe the report was taken in stride and Wednesday’s private ADP Payroll survey set expectations lower already. Ultimately, without any help from Washington, this, coupled with technical support, paved the way for the late relief rally.
Yes, the drama in Washington continues. First, on Friday, Democratic Senator Manchin vocalized his resistance against increasing stimulus checks to $2,000. After Democrats took both Georgia Senate seats last week, they now hold a narrow margin in the split Senate with Vice President-elect Harris being the deciding vote. Furthermore, the market surged on expectations of a clearer path to added stimulus measures. This is certainly an added uncertainty. Now, throw in House Speaker Pelosi’s move to impeach President Trump. Trump is already out, and the market has shifted focus to President-elect Biden. As this maneuver gains traction, the market will likely view it as stealing valuable time away from fiscal talks.
Today’s economic calendar is bare. Traders received comments from ECB President Christine Lagarde at 8:40 a.m. CT and Atlanta Fed President Raphael Bostic, a 2021 voter, at 11:00 a.m. CT. Also, with the 10-year yield at 10-month highs, the 3-year Note auction at noon CT will be watched closely. Last night, inflation data from China came in higher than expected. Still, the U.S. Dollar is recovering from oversold and over-discussed conditions, weighing on risk-assets.
Interested in our technical perspective? Please sign up to have Blue Line Futures technical outlook, actionable bias, and proprietary levels emailed to you each day.