Stocks End Higher, Despite Disappointing Jobs Report

Summary of content for the week of May 7:

1. Week 18 major indexes performance;

2. Week 18 US sector indexes performance;

3.Major indexes weekly charts of support and resistance levels;

U.S

U.S major indexes mixed for the week ended May 7, as DJI and SPX closed new highs, while the technology-heavy Nasdaq(COMP) recorded its worst weekly loss in two months. Refer to below weekly performance for major indexes.

Major events happened during the period:

1.    Nonfarm payroll reported on Friday shows jobs added by only 266k in Apr, much below the nearly 1million jobs widely expected. The much lower jobs number calm overheating worries, led Friday’s rally as investors think the economy was not growing as fast as some expected. 

2.    Unemployment rate ticked up to 6.1% from 6.0% in Apr. The stall in Apr confirms the Fed will keep its policy stimulus in place for some time to comes as it targets “broad-based and inclusive maximum employment.” 

3.    Earnings season continued to wind down over the week, with 442 of the SPX 500 companies expected to have reported 1Q results by the end of the week, according to data from Refinitiv. Earnings have generally beat estimates by a wide margin. However, it appears that earnings beats or misses do not have dramatic effects on stock prices.

Among SPX index sectors, Technology(XLK) underperformed, along with consumer discretionary(XLY), utilities(XLU), and real estate(XLRE) stocks, while energy(XLE) and financials(XLF) outperformed for 3th week in a row. Refer to below SPX sector indexes weekly performance table.

Technically, the three major indexes weekly charts remain in strong uptrend. Refer to below major indexes weekly charts.

China/HK

China's SSE index fell in a holiday-shortened week. Mainland markets reopened Thursday after being closed Monday through Wednesday for the Labor Day holiday.  Chinese star technology stocks listed in Hong Kong continued trading weak as U.S China tension rises on the technology front. Technically, both SSE and .HSI indexes still trapped within their three months price range, consolidation.

Singapore

STI index recovered most of its losses on last two trading days of the week, from early in the week as it hit a six-week low. Technical bullish bias with next target level at around 3300 level.