Directional Bias for the Day:

• S&P Futures are higher at 8:45 AM; futures are moving within a range since Wednesday’s close.
• Odds are for a sideways to an up day. Watch for a break above 6105.00 or a break below 6086.50 for clarity.
• The notable economic data due during the day:
  • Unemployment Claims (219K vs. 214K est.; prev. 208K) at 8:30 AM.
  • Prelim Unit Costs (3.0% vs. 3.4% est.; prev. 0.8%) at 8:30 AM.
  • Prelim Nonfarm Productivity (1.2% vs. 1.5% est.; prev. 2.2%) at 8:30 AM.

Key Levels:

• Critical support levels for the S&P 500 are 6043.16, 6021.37, and 6007.06.
• Critical resistance levels for the S&P 500 are 6078.65, 6089.36, and 6114.02.
• The key levels for E-mini futures are 6105.00, the high at 4:00 AM, and 6086.50, the low at 7:15 AM.

Pre-Open

• On Wednesday at 4:00 PM, S&P futures (March 2025) closed at 6086.00, and the index closed at 6061.48 – a spread of about +24.50 points; the futures closed at 6086.50; the fair value is -0.50.
• Pre-NYSE session open, futures were mixed – at 8:30 AM, the S&P 500 futures were up by +10.50, Dow up by +31 and NASDAQ down by -3.25.

Markets Around the World

• Markets in the East closed mostly higher – Mumbai closed down.
• European markets are higher
• Currencies (Compared to two weeks ago):

• Commodities (Compared to two weeks ago):
  • Energy futures are lower.
  • Precious metals are higher.
  • Industrial metals are higher.
  • Soft commodities are mostly higher.
• Treasuries (Compared to two weeks ago)
  • The 10-year yield closed at 4.432, down -18.4 basis points from two weeks ago.
  • The 30-year is at 4.630%, down -19.7 basis points.
  • The 2-year yield is at 4.197%, down -10.5 basis points.
  • The 10-Year-&-2-Year spread is at 0.235, down from 0.314.
  • The 30-Year-&-10-Year spread is at 0.198, down from 0.211.
• VIX
  • At 15.82 @ 8:45 AM; up from the last close; below the 5-day SMA
  • Recent high = 22.51 on January 27; low = 14.90 on January 31; Sentiment: Risk-Neutral-On

The trend and patterns in various time frames for the S&P 500:

Previous Session

Major U.S. indices closed higher on Wednesday, February 5 in mostly lower volume. Dow Jones Transportation Average traded in higher volume. The major indices opened lower but made day’s lows in the first hour of trading and then traded higher for the rest of the day.

The dollar index and crude oil closed down, the precious metals closed mixed, the industrials closed higher, and the soft commodities closed mixed. The US Treasury declined and the bonds advanced. All but three S&P sectors – Consumer Discretionary, Materials, and Communications – closed higher.

From Briefing.com

The stock market traded with a positive bias, but index performance was mixed due to declines in highly influential names. The Nasdaq Composite, which flirted with the unchanged mark through most of the session, ultimately settled 0.2% higher. The S&P 500 logged a 0.4% gain, and the Dow Jones Industrial Average jumped 0.7%.

The 10-yr yield dropped nine basis points to 4.42% and the 2-yr yield dropped four basis points to 4.18%. The rally in the Treasury market followed weaker-than-expected Services PMI readings for January out of China, Europe, and the U.S. that fostered some growth concerns.

• Dow Jones Industrial Average: +5.5% YTD
• S&P Midcap 400: +4.1% YTD
• Russell 2000: +3.9% YTD
• S&P 500: +3.1% YTD
• Nasdaq Composite: +2.0% YTD

Reviewing today’s economic data:

• The December Trade Balance Report showed a widening in the deficit to $98.4 billion (Briefing.com consensus -$98.0 billion) from a downwardly revised $78.9 billion (from -$78.2 billion) in November. December exports were $7.1 billion less than November exports while December imports were $12.4 billion more than November imports.
• January S&P Global US Services PMI – Final 52.9 vs. 52.8 prior
• The ISM Services PMI decreased to 52.8% in January (Briefing.com consensus 53.9%) from a downwardly revised 54.0% (from 54.1%) in December. The dividing line between expansion and contraction is 50.0%, so the January reading reflects services sector activity expanding but at a slower pace than the prior month. January marked the 53rd time in 56 months that the Services PMI indicated expansion.