S&P500 Forecast SPX is flat after a mixed data drop, MU disappoints

US futures

Dow future -0.16% at 39065

S&P futures 0.02% at 5478

Nasdaq futures -0.01% at 19744

In Europe

FTSE -0.08% at 8222

Dax 0.22% at 18204

Continuing jobless claims rise to the highest level since 2021
Stocks muted ahead of tomorrow’s inflation data
Micron Technology's outlook disappoints dragging chip stocks lower
Oil rises as geopolitical tensions offset demand concerns

Continuous jobless hit multi-year high

U.S. stocks are pointing to a higher start as investors digest the latest jobs and GDP data from the US and disappointing guidance from Micron Technologies. The mood is cautious ahead of tomorrow’s core PCE data tomorrow.

Initial jobless claims came in weaker than expected at 233K, down from 236K. Continuing claims, which are a proxy for the number of people receiving benefits, rose to 1.84 million in the week ending June 15th, their highest level since the end of 2021. This data is considered a warning sign that it takes longer for unemployed people to find a job.

The data suggests that hiring has slowed significantly as unemployment ticked up to 4% for the first time in two years. San Francisco Fed President Mary Daly warned of labour market risk. She considered the labour market to be reaching a crucial point where further softening could lead to a rise in joblessness.

A weaker jobs market could encourage the Federal Reserve to cut interest rates sooner rather than later. The data comes as US households’ pandemic savings are dwindling and delinquencies are rising.

Meanwhile, Q1 GDP was revised higher to 1.4% annualised, up from 1.3%, and the core PCE index was also revised higher to 3.7%, up from 3.6.

Corporate news

Micron Technologies is set to open 6% lower after the chipmaker unveiled a disappointing current quarter outlook. Given the surge in enthusiasm surrounding AI, the company faced high expectations.

Levi Strauss is expected to open over 16% lower after the jeans manufacturer posted a miss in Q2 revenue amid weak demand at dockers for its Chino's brand.

Walgreens Boots is set to open almost 5% lower after the pharmacy chain cut its fiscal 2024 guidance amid a deteriorating retail environment and said that it would close more stores.

S&P 500 forecast – technical analysis.

The S&P 500 is consolidating below its record at 5516. The consolidation has brought the RSI out of overbought territory. While the index has fallen below its near-term rising trendline, the longer-term trendline remains intact. Buyers will look to rise above 5500 and 5516 to fresh record highs. Support can be seen at 5400, the mid June low and the rising trendline support.

FX markets – USD falls, GBP/USD rise

The USD is falling after mixed data. Continuing claims point to a weakness in the labour market. However, Q1 core PCE was hotter than expected at 3.7%.

EUR/USD is rising amid a weaker USD and despite eurozone economic sentiment coming in weaker than expected. Economic sentiment in the region softened in June to 95.9, down from 96. The data comes after weak data from Germany this week, which raised concerns over the outlook for the region and its economic recovery.

USD/JPY is falling from the 38-year high of 169.90 reached overnight. Stronger-than-expected Japanese retail sales have helped to boost the yen, although it remains in intervention territory. The pair has risen to levels last seen in 1986 on Fed-BoJ divergence.

Oil hovers around a 2-month high

Oil prices are inching higher on Thursday as concerns over supply disruption as geopolitical tensions rise in the Middle East offset demand worries after a surprise build in US inventor ease.

According to the US Energy Information Administration, stockpiles rose by 3.6 million barrels, well above the expected drawdown of 2.9 million barrels. Gasoline stockpiles also rose by 2.7 million barrels, compared with an expected 4 million drawdown.

The ramping up of geopolitical risk in the Middle East has pushed demand worries lower. Tensions between Israel and Lebanon's Hezbollah have escalated in recent weeks amid fears that the war could start to draw in other major oil producers, such as Iran.

This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

StoneX Financial Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit www.cityindex.com/en-sg/terms-and-policies for the complete Risk Disclosure Statement.

ALL TRADING INVOLVES RISKS. LOSSES CAN EXCEED DEPOSITS.

City Index is a trading name of StoneX Financial Pte. Ltd. (“SFP”) for the offering of dealing services in Contracts for Differences (“CFD”). SFP holds a Capital Markets Services Licence issued by the Monetary Authority of Singapore for Dealing in Exchange-Traded Derivatives Contracts, Over-the-Counter Derivatives Contracts, and Spot Foreign Exchange Contracts for the Purposes of Leveraged Foreign Exchange Trading. SFP is also both Derivatives Trading and Clearing member of the Singapore Exchange (“SGX”). SFP is a wholly-owned subsidiary of StoneX Group Inc.

The information provided herein is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to invest, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk.

The information does not represent an offer of, or solicitation for, a transaction in any investment product. Any views and opinions expressed may be changed without an update. To understand the risks and costs involved, please visit the section captioned “Important Information” and the “Risk Disclosure Statement”.

The information herein is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation.

StoneX Financial Pte. Ltd. 1 Raffles Place, #18-61, One Raffles Place Tower 2, Singapore 048616. Tel: 6309 1000. Co. Reg. No.: 201130598R.

This advertisement has not been reviewed by the Monetary Authority of Singapore.