S&P 500 Momentum Report
A drift higher in Wall Street overnight places the S&P 500 and Nasdaq in an all-time closing high.
![Wall Street](http://a.c-dn.net/c/content/dam/publicsites/igcom/uk/images/news-article-image-folder/GT_Wall_Street_18-04-24.jpg/jcr:content/renditions/original-size.webp)
S&P 500, Nasdaq drifted to all-time closing high to start the week
A drift higher in Wall Street overnight places the S&P 500 and Nasdaq in an all-time closing high, but reservations should remain in place as we look towards a series of key economic event this week, which can significantly move the dial around the Federal Reserve (Fed)’s policy path ahead.
This week will see the release of US inflation numbers on Wednesday, before the Federal Open Market Committee (FOMC) meeting decision the next day. With inflation progress having stalled around the 3.0% - 3.5% range over the past months, it does not seem to provide the conviction for the Fed to deliver earlier rate cuts.
Expectations are for US May headline inflation to edge slightly lower to 3.5% from previous 3.6%, while the core aspect is expected to stay unchanged at 3.4%. Month-on-month, the core consumer price index (CPI) is expected to come in at 0.3%, unchanged from April as well.
It may have to take a significant downside inflation surprise to reassure the Fed that they have room to deliver more rate cuts this year, otherwise it may seem that one rate cut in November/December could be the timeline as what market rate expectations are priced for currently.
Nasdaq 100: Formation of new higher high
The Nasdaq 100 index continues to extend its rally to a fresh record closing high, reinforcing its prevailing upward trend as big tech stood resilient amid the high-for-longer rate narrative. A broader ascending wedge pattern seems to be in place, which may place the 19,300 level on watch as potential resistance, where the upper trendline resides. Thus far, the daily relative strength index (RSI) has been trading above the key 50 level, but given the lower-highs formation which may leave a near-term bearish divergence in place, some indecision may be persist for now. On the downside, the 18,950 level may serve as immediate support to hold, where it marked the previous post-earnings dip.
Levels:
R2: 20,000
R1: 19,300
S1: 18,950
S2: 18,500
![US Tech 100](http://a.c-dn.net/c/content/dam/publicsites/igcom/sg/files/education/MoMo_Report/SGX_USTech100Cash_momo_110624.png/jcr:content/renditions/original-size.webp)
S&P 500: Upward trendline support on watch
The S&P 500 has a stellar recovery as well, closing at its highest record level and once again, showing that any dip is a temporary retracement within a broader upward trend. A broader rising channel pattern can be looked upon as reference for its upward trend, with its daily RSI successfully defending the mid-line at the end of May. That said, similar to the Nasdaq 100 index, its RSI has failed to make a higher high despite the index doing so, which may leave some near-term caution in place. Any retracement may leave the 5,260 level on watch, where the broader channel pattern may continue to hold.
Levels:
R2: 5,600
R1: 5,485
S1: 5,260
S2: 5,000
![US 500 Cash](http://a.c-dn.net/c/content/dam/publicsites/igcom/sg/files/education/MoMo_Report/SGX_US500Cash_momo_110624.png/jcr:content/renditions/original-size.webp)
Source: IG charts
Sector performance
The S&P 500 has delivered yet another fresh record closing high over the past week, once again riding on strength in growth sectors to edge 1.5% higher. Big tech stocks remained the heavy-lifters, with Nvidia (+5.9%) leading the pack, while Meta (+5.3%), Amazon (+4.9%), Microsoft (+3.5%) and Alphabet (+1.3%) were all broadly higher. Apple (-0.5%) and Tesla (-1.4%) are the laggards among the Magnificent Seven stocks last week. Market breadth for the S&P 500 (% of stocks above 50-day, 100-day and 200-day moving average) continues to display lower highs, which marked a divergence with the index and suggests that we may have to see some broadening in strength for rally sustenance ahead.
![SPX sector returns: One-week and one-month](http://a.c-dn.net/c/content/dam/publicsites/igcom/sg/files/education/MoMo_Report/SGX_SPXSectorReturnsOneWeekAndOneMonth_momo_110624.png/jcr:content/renditions/original-size.webp)
Source: Refinitiv
![SPX sector returns: One-month and year-to-date](http://a.c-dn.net/c/content/dam/publicsites/igcom/sg/files/education/MoMo_Report/SGX_SPXSectorReturnsOneMonthAndYearToDate_momo_110624.png/jcr:content/renditions/original-size.webp)
Source: Refinitiv
![Sector ETFs summary](http://a.c-dn.net/c/content/dam/publicsites/igcom/sg/files/education/MoMo_Report/SGX_SectorETFSummary_momo_110624.png/jcr:content/renditions/original-size.webp)
Source: Refinitiv
*Note: The data is from 4th – 10th June 2024.
![Top 15 winners and losers](http://a.c-dn.net/c/content/dam/publicsites/igcom/sg/files/education/MoMo_Report/SGX_Top15WinnersAndLosers_momo_110624.png/jcr:content/renditions/original-size.webp)
Source: Refinitiv
*Note: The data is from 4th – 10th June 2024.
![Top stocks by sectors](http://a.c-dn.net/c/content/dam/publicsites/igcom/sg/files/education/MoMo_Report/SGX_TopStocksBySectors_momo_110624.png/jcr:content/renditions/original-size.webp)
Source: Refinitiv
*Note: The data is from 4th – 10th June 2024.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. 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. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
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