Daily Equity Future Overview

Equity futures overview The S&P500 futures ended with losses last week after trading below the 1400.00 level on Thursday and Friday, though we did close above here.

My Thoughts from the Trading Floor
	Equities still weak Equity markets remained on the back foot last week as we closed lower again. Thursday and Friday saw the Spoo futures trade below the 1400 area for the first time since the beginning of September, making a low at 1394.50. We did close above here but are back around that level this morning. This was good support throughout August and has worked again so far. The bulk of the losses came on Tuesday which was a continuation of Friday’s moves after Monday’s pause for thought. Earnings have dented confidence despite slightly better than expected US growth figures released last week. Hurricane Sandy Hurricane Sandy is expected to hit the East Coast this week and of course any significant damage and disruption this causes is likely to have a negative impact on equity markets due to the lack of economic activity in the NYC area and the potential cost of any clean up. How bad this will be we can only determine in the coming days. This is also likely to lead to much lighter volumes than usual though. Floor trading is closed on Monday and this could well extend to later in the week. Be careful when trading as the algo’s have a field day amongst lack of real liquidity!! Lots of data this week Plenty of data is out this week with all eyes again on the unemployment numbers out of the US (this is the last reading before the election). On top of this we have ISM data as well European PMI’s. The strength or weakness of these numbers should drive the general price direction over the coming two weeks. End of the month Wednesday sees the last day of the month which traditionally causes a sell off going into the close of both the European and US cash market closes so keep an eye out again. Last month the FTSE and Dax both did around 30 ticks in the final few minutes of cash trading, while the Spoo futures sold off a couple of handle before coming right back. If we do see a sell off into the close expect a strong day on Thursday. Technical Oulook 1394.50-95.50 was good support throughout the end of August and it also stopped the sell off last week. This is the key area below though there may also be some responsive buyers around 1387.50-88.25 while 1391.00 represents a high volume area for the December contract. If we do continue to see weakness then there is a major support area around 1369.00-76.00. If 1391.00 and above continues to support the market then we should see a bounce up to 1411.25-12.75 at least, with an eye on 1420-25 further up. Important events this week     Monday: US Core PCE     Tuesday: DE Unemployment, EU Consumer Confidence, US Consumer Confidence     Wednesday: US Chicago PMI     Thursday: UK PMI Manufacturing, US ADP Employment, Initial Claims ISM Manufacturing     Friday: EU Manufacturing PMI’s, US NonFarm Payrolls Bull View The market did bounce of precious support at 1394.50-95.50 and from here a move back up towards 1411.25-12.75 could materialise. A test of 1420-25 would be the main target. Bear View The bears remain in short term control; another test of the recent lows would put more pressure on the market and open us up to testing 1391.00 (high volume area) and then 1387.50-88.25.