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U.S. equity index futures green: Nasdaq 100 up ~0.9%
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U.S. Q4 GDP 2nd est 2.7% vs 2.9% est
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Prelim core PCE prices > est
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U.S. initial jobless claims 192k vs 200k est
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Euro STOXX 600 index up ~0.2%
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Dollar edges up; gold slips; crude gains, bitcoin off
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U.S. 10-Year Treasury yield rises to ~3.96%
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S&P 500 ENERGY SECTOR STILL WELL-CAPPED BY RECORD HIGHS
(0900 EST/1400 GMT)
The S&P 500 energy sector has been the market's go
to group. SPNY rocketed 59% in 2022, for its biggest yearly
percentage rise ever. In fact, it was the only S&P 500 sector to post a gain in 2022, in a year that the benchmark
index ended down nearly 20%.
That said, energy failed to surpass its 2014 record high,
and waning monthly momentum suggests caution:
SPNY hit a high of 724.74 in November of last year, putting
it within 2% of its 738.71 record-high recorded in June 2014.
However, the monthly RSI failed to confirm the sector's rise
late last year. A similar pattern of divergence developed into
the group's 2008 top.
Since its November peak, the sector has gyrated wildly, and
now stands down 12% from that high. Year-to-date, the energy
sector is off just over 5% vs an SPX rise of about 4%.
SPNY is on track to end February above its rising 12-month
moving average (MMA) for a 27th-straight month. If so, it will
exceed the 26-month run into its 2014 high. The sector ended
above its 12-MMA for 62-straight months into its 2008 top.
In any event, with the 12-MMA now around 625, or less than
2% below Wednesday's 637.29 close, the group may need to quickly
heat up again. Traders will be watching for a monthly close
below the 12-MMA as it may confirm a significant break in SPNY's
longer-term advance.
Meanwhile, NYMEX crude futures have been on the back
foot. The futures now around $75.00 are down more than 40% from
their $130.50 March 2022 high, and a chart magnet still beckons
for lower levels.
(Terence Gabriel)
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(Terence Gabriel is a Reuters market analyst. The views
expressed are his own)
