S&P 500 futures are down 0.5% this week,
trading at 5713 points, recovering from a midweek low of 5672 points. Investors
are now focusing on the upcoming September Nonfarm Payrolls report, which is
expected to show positive results. The upside scenario for the S&P 500
index, with extreme targets of 6100-6200 points, remains possible if the index
holds above the 5790-5810 point range. Large investors seem to be leaning
towards this outcome, as the SPDR S&P 500 ETF Trust (SPY) saw net inflows
of $19.8 billion last week and another $1.4 billion in the first three days of
this week.
Recent U.S. macroeconomic data has been
largely positive. Federal Reserve (Fed) Chair Jerome Powell expressed
confidence in the strength of the U.S. economy on Monday, while JOLTs data on
Tuesday showed a sharp rise in job openings for August. The ADP Nonfarm
Payrolls for September also surpassed analysts’ expectations, and the ISM
Non-Manufacturing PMI jumped to 54.9 in September from 51.5 the previous month.
Despite this positive data, the S&P 500
index is under pressure due to the escalating conflict in the Middle East. An
Iranian missile strike on Israel pushed the benchmark down by 1.3%, and Brent
crude oil prices surged 8.5% to $78.95 per barrel, the largest increase since
January 2023. Rising energy prices could reverse the recent slowdown in U.S.
inflation, potentially complicating the Fed's decision-making process regarding
further interest rate cuts.
Looking ahead, investors are focused on the
Nonfarm Payrolls report for September, which is expected to show figures
between 153,000-188,000, above the consensus estimate of 147,000. The
unemployment rate is expected to hold steady at 4.2%, with a chance of dipping
to 4.1%, while average hourly earnings are projected to slow to 0.3% month-over-month,
down from 0.4%. This would be a moderately positive scenario for the market and
could prompt further gains in the S&P 500.
From a technical perspective, the S&P 500
index has reached its primary target of 5700-5800 points. If the index surpasses
the 5800 level, it may continue its upward climb towards the extreme targets of
6100-6200 points.
Brent crude oil prices are currently supported
at $70.00-72.00 per barrel, with OPEC+ deciding to postpone production
increases until December. However, geopolitical tensions in the Middle East,
particularly the potential for an escalation of the Iran-Israel conflict, are
driving prices higher, with Brent nearing resistance at $79.00-81.00 per
barrel.
Gold prices have reached mid-term targets of
$2,000-2,100 per ounce and are now pushing towards higher resistance levels at
$2,750-2,770. If no reversal occurs, gold could continue its rise towards
$2,850 per ounce, with potential to hit extreme targets of $3,200-3,300 per
ounce.
In the
currency market, the EUR/USD pair
is hovering near key support at 1.10000. A breach of this
support could lead the pair down to the 1.05000-1.07000 range, while a rise
above 1.11000 may signal a potential rebound.