S&P 500 broad
market index futures surged by 2.5% to 5088 points, a notable acceleration from
the 0.4% increase observed on Thursday. This rise followed
robust Q1 2024 earnings reports from Microsoft (MSFT) and Alphabet (GOOG).
Prior to the publication of these earnings,
investors had some apprehension due to weak PMI data released in the United
States. However, their concerns were somewhat alleviated by strong earnings
results. Despite this positive news, the US Q1 GDP unexpectedly dropped to 1.6%
QoQ, well below the forecasted 2.5% QoQ and marking the lowest reading since Q2
2022. This downturn in economic growth, coupled with a rise in the PCE index to
3.7% (above the consensus of 3.4%), suggests a rapidly deteriorating American
economy with increasing inflation—a combination reminiscent of stagflation last
seen in the 1970s.
The stellar performance of Microsoft and
Alphabet came at an opportune moment. Both companies significantly surpassed
consensus expectations, with Alphabet even announcing its first-ever dividend
of $0.20 per share and initiating a $70 billion buyback. This news propelled
MSFT stocks to increase by 3.9% to $414.5 per share, while GOOG stocks surged
by 11.2% to $175.50.
Investors are now eagerly awaiting the release
of the March PCE index to gain insights into recent developments in consumer
spending. Strong corporate earnings could offset any negative reaction if March
numbers surpass expectations. Conversely, PCE numbers below forecasts could be
balanced by expectations for the next Fed meeting scheduled for next week.
Overall, investors are seeking clarity on potential adjustments to their stock
positions in May and June.
From a technical perspective, the S&P 500
index continues to move within a downside formation with a target at 4800-4900
points, with extreme downside targets at 4400-4500 points. Resistance is seen
at 5090-5110 points, and if the correction persists next week, a downside
scenario with extreme targets may become the baseline trend.
Oil prices are currently consolidating within
the range of $87.00-92.00 per barrel of Brent crude, with the path to $100 per
barrel currently blocked. Downward pressure is expected to continue until
mid-May, with support located at $81.00-83.00 per barrel.
Gold prices, having reached mid-term upside
targets at $2000-2100 per troy ounce and extreme targets at $2400-2500, remain
intact. However, consolidation is expected as prices are already quite high.
The nearest support is at $2290-2310, with resistance at $2390-2410 per ounce.
The Greenback is retreating, with the EURUSD
recovering to 1.07500. Despite weak macroeconomic data in the United States,
the EURUSD is still heading towards 1.05000.