U.S. markets showed strong momentum on Monday’s open after the U.S. and China agreed to a truce in their trade war over the weekend, with President Donald Trump saying he would not raise tariffs at the start of the new year as he had previously threatened to do.
The major indexes backed off their highs after Treasury Secretary Mnuchin confirmed the change in tone, but did suggest that Trump retained all options if progress was not satisfactory. The small-caps struggled but also closed higher despite making a midday trip into negative territory.
The Nasdaq soared 1.5% after peaking at a morning high of 7,486. Lower and fresh resistance at 7,450-7,500 and the 50-day moving average was challenged but held with a close above 7,525 and the 200-day moving average signaling additional momentum.
The S&P 500 was higher by 1.1% following the opening surge to 2,800. Fresh resistance at 2,800-2,825 held with the close above the 50-day and 200-day moving averages being a bullish development.
The Dow rose 1.1% after trading to a session peak of 25,980. Fresh and lower resistance at 25,800-26,000 was cleared and held with the close above the 50-day moving average signaling additional strength.
The Russell 2000 gained 1% following the opening push to 1,553. Early November resistance at 1,550-1,560 and the 50-day moving average held with a close above the latter getting 1,580-1,600 in play.
Energy and Technology led sector strength after rising 2.2%. Consumer Discretionary and Materials advanced 1.9% and 1.8%.
Healthcare was the only sector laggard after giving back 0.5%.
AT&T (T) upgraded to Outperform from Market Perform at Cowen
First Solar (FSLR) upgraded to Neutral from Sell at Goldman Sachs
Roku (ROKU) upgraded to Buy from Neutral at DA Davidson
Costco (COST) downgraded to Neutral from Buy at Citi
LabCorp (LH) downgraded to Hold from Buy at Craig-Hallum
Quest Diagnostics (DGX) downgraded to Neutral from Buy at BofA/Merrill
Tuesday's earnings announcements (EST):
Before the open: Autozone (AZO), Bank of Montreal (BMO), Conn’s (CONN), Donaldson Company (DCI), GMS (GMS), HD Supply Holdings (HDS), Movado Group (MOV), Toll Brothers (TOL)
After the close: Guidewire Software (GWRE), HealthEquity (HQY), Hewlett Packard Enterprises (HPE), Marvell Technology (MRVL), Ollie’s Bargain Outlet (OLLI), Zscaler (ZS)
UPCOMING ECONOMIC NEWS
Tuesday's Economic Reports (EST):
Redbook - 8:55am
METALS / OIL
Gold closed at $1,233.90 an ounce, up $13.70
Silver settled at $14.50 an ounce, down $0.28
Copper finished at $2.81 a pound, up $0.02
Crude Oil is at $53.11 a barrel, up $0.53
Bitcoin Investment Trust (GBTC) ended at $4.75
I hope this helps you prepare for the trading day. Make it a great one!
Blue-Chips Clear 50-Day Moving Average