US market: review and forecast for March 26. The story in the Suez Canal continues
Market day before
Trading on March 25, US stock exchanges ended in the green zone for the first time in three sessions. The S&P 500 index rose 0.52% to 3,909 points, the Dow Jones added 0.62%, and the NASDAQ rose 0.12%. The financial sector (+1.58%) and the industrial sector (+1.56%) showed the best dynamics. Among the outsiders were telecom companies (-0.33%) and IT companies (-0.07%).
Restaurant chain Darden Restaurants (DRI: +8.19%) posted strong results for the 3rd fiscal quarter of 2021. Diluted earnings per share exceeded the consensus forecast by 40.2% to $ 0.98.
Clothing retailer Gap (GPS: +5.01%) announced the sale of the children's clothing brand Janie and Jack to Go Global Retail. The amount of the transaction was not disclosed.
Media company ViacomCBS (VIAC: -5.35%) at the beginning of the week announced its intention to place Class B ordinary shares and Series A convertible preferred shares in the amount of $3 billion. The funds raised will be used to finance capital expenditures. The quotes continued to fall and for the week corrected by 33.41%.
Global stock markets are showing positive dynamics. European markets are showing growth after a strong start to the trading session in Asia. US index futures are also strengthening on the back of the growth of cyclical sector companies. Yields on 10-year US Treasuries have resumed positive dynamics and are currently adding 1.43%. Concerns about a third wave of COVID-19 in the EU remain, with a rapid increase in the incidence observed in Germany, France and Italy, but the movement of quotations still reflects optimism about the ongoing vaccination. The US dollar hit a multi-month high overnight. WTI crude oil continues to show growth after overnight losses and is currently trading at $59.78, but quotes still remain under pressure due to the fact that it may take weeks to unload a massive container ship blocking the Suez Canal. We expect that the growth of cyclical sector securities will continue, and against the background of a renewed increase in treasury yields, the financial sector will also strengthen.
Asian stock markets showed mixed dynamics. China's CSI 300 gained 2.27%, Japan's Nikkei 225 rose 1.56%, and Hong Kong's Hang Seng rose 1.57%. Europe's EuroStoxx 50 is up 0.53%.
Market participants ' risk appetite is growing. The rate on 10-year treasuries strengthened to 1.65%. Gold is trading at $1,725. Silver shows an increase of 0.88%, to $25.26.
I expect that the S&P 500 will spend the upcoming session in the range of 3900-3950 points.
Economic news and macro statistics
On March 26, the monthly data on the personal consumer spending Index (PCE) will be published. The market consensus is at 1.5%, which corresponds to the actual level of February.
Technically, the S&P 500 is still in an uptrend. The bearish divergence in the RSI indicator continues to determine the short-term tendency of the broad market index to correct. Nevertheless, a positive signal in the near term is yesterday's rebound from the 50-day moving average at 3870 points.