On the last trading day of the week, major US equity indices opened flat, with both the S&P 500 and Nasdaq Composite index on track for weekly declines.
During opening hour of trading, the Dow Jones Industrial Average was down nearly 30-point to 19,160, while the broader S&P 500 index was absolutely flat near yesterday’s closing level around 2,192. Meanwhile, tech-heavy Nasdaq Composite outperformed the broader indices and gained over 15-point to 5,267.
Major indices halted their post-US election rally over the past three weeks to record levels as investors seems to have turned cautious and remained concerned over the velocity of recent up-surge, which could have taken the markets ahead of the fundamentals. The concern was reflected in today’s US monthly jobs report that showed 178K new jobs added were added during the month of November, slightly above 175K expected. Meanwhile, average hourly earnings unexpectedly contracted by 0.1%, while reading for the previous two months were also revised lower. However, the miss in earnings growth number and downward revision of previous numbers were not enough to alter market expectation of a December Fed rate-hike
Investors on Friday were also cautious ahead of the Italian constitutional referendum on Sunday, where a ‘NO’ vote could lead to resignation of Italian Prime Minister Matteo Renzi, as well as the dissolution of Italy’s government and trigger a fresh bout of volatility in global financial markets.
Carol Harmer, Founder at charmertradingacademy.com, notes, “Good short term support coming in @ 2187… 2183 is your next big level really…If we break below here 2175 would be the targeted area….Any longs currently are to be used short term only and we would like any correction now to hold below the 2204 area….”
She further writes, “2204 breaks there is scope for 2210/13 again…but sellers will be here to keep the market under threat…”