S&P 500 Hits Record Ahead of Jackson Hole, Hang Seng May Retreat

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S&P 500 Hits Record Ahead of Jackson Hole, Hang Seng May Retreat

The S&P 500 and Nasdaq 100 hit all-time highs on Wednesday as investors awaited the Jackson Hole symposium for clues about the Fed’s next move. Asia-Pacific markets look set to open in cautious mood.

S&P 500, HANG SENG INDEX, ASX 200 INDEX OUTLOOK:

  • Dow Jones, S&P 500 and Nasdaq 100 closed +0.11%, +0.22%, and +0.07% respectively
  • Fed Chair Jerome Powell will give a speech at Jackson Hole symposium this Friday
  • Asia-Pacific markets look set to open mixed, with investors eyeing the Fed’s tapering timeline

S&P 500, Jackson Hole, USD, Southbound, Asia-Pacific at the Open:

Wall Street stocks closed mildly higher on Wednesday, extending a rally after the FDA granted full approval to the Covid-19 vaccine developed by Pfizer and BioNTech. This boosted reflation hopes and fueled cyclically-oriented sectors such as financials, energy, industrial and materials. Meanwhile, investors are eyeing the Jackson Hole symposium for clues about the Fed’s tapering timeline.

Fed Chair Jerome Powell will give a speech at the Fed’s annual economic symposium at Jackson Hole on Friday. Global investors will watch closely whether or not the central bank is planning to scale back the $120 billion per month asset purchase by the end of this year. The market doesn’t seem to be too concerned about that however, as the DXY US Dollar index fell 4 days in a row to 92.82.

Gold prices pulled back to test support at $1,785. Crude oil prices extended a 4-day rally to $68.02, although the upward momentum seems to be weakening. The market appears to have priced in a possible scenario of tapering by the end of this year, and the Jackson Hole symposium may reaffirm this prospect.

WTI Crude Oil Price – Daily

S&P 500 Hits Record Ahead of Jackson Hole, Hang Seng May Retreat

Looking ahead, the GfK consumer confidence data dominates the economic docket alongside US GDP and initial weekly jobless claims. Find out more from theDailyFX economic calendar.

Asia-Pacific markets look set to open mixed on Thursday. Futures in Japan, South Korea, Taiwan, Malaysia and Thailand are in the green, whereas those in mainland China, Hong Kong, Australia, Singapore and India are in the red.

Looking back to Wednesday’s close, 7 out of 11 S&P 500 sectors ended higher, with 71.3% of the index’s constituents closing in the green. Financials (+1.21%), energy (+0.72%) and industrials (+0.60%) were among the best performers, whereas healthcare (-0.26%) and real estate (-0.18%) trailed behind.

S&P 500 Sector Performance 25-08-2021

S&P 500 Hits Record Ahead of Jackson Hole, Hang Seng May Retreat

Source: Bloomberg, DailyFX

S&P 500 IndexTechnical Analysis

The S&P 500 index is trending higher within an “Ascending Channel” formed since November, as highlighted in the chart below. The next key resistance level can be found at 4,650 – the 161.8% Fibonacci extension. The overall trend remains bullish-biased as suggested by the SMA lines. The MACD indicator formed a lower high recently however, suggesting that upward momentum may be weakening.

S&P 500 IndexDaily Chart

S&P 500 Hits Record Ahead of Jackson Hole, Hang Seng May Retreat

Hang Seng Index Technical Analysis:

The Hang Seng Index found some support at 24,850 and has since rebounded. Holding above this level may pave the way for a technical rebound towards 26,200 – the 61.8% Fibonacci retracement. The MACD indicator remains below the neutral midpoint, underscoring bearish momentum.

Hang Seng Index – Daily Chart

S&P 500 Hits Record Ahead of Jackson Hole, Hang Seng May Retreat

ASX 200 Index Technical Analysis:

The ASX 200 index pulled back sharply to test an immediate support level at 7,500 – the previous resistance. The overall trend remains bullish-biased, as suggested by the consecutive higher highs and higher lows formed over the past few months. The MACD indicator formed a bearish crossover after hitting trendline resistance, suggesting that selling pressure may be prevailing.

ASX 200 Index – Daily Chart

S&P 500 Hits Record Ahead of Jackson Hole, Hang Seng May Retreat

— Written by Margaret Yang, Strategist for DailyFX.com

To contact Margaret, use the Comments section below or @margaretyjy on Twitter



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