S&P 500 Index Break 5,000 Record for First Time

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Weekly Wrap Content for the week of Feb 9:

1. Week 6 major indexes performance;

2. Week 6 US sector indexes performance;

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

U.S.

For the week ended Feb 9, U.S three major indexes moved higher over the week, with the S&P 500 Index reaching new highs and breaching the 5,000 threshold for the first time, behind earnings strength and bullishness over tech, economy outlooks. The advance remained relatively narrow, however, with an equally weighted version of the index significantly trailing the standard market-weighted version for the fourth time in five weeks. Refer to major indexes’ weekly performance table below.

Key highlights for the week and next:

1.    The U.S. Treasury Department’s record $42 billion auction of 10-year notes got solid reception. The auction calmed fears that the government’s record borrowing levels would push borrowing costs higher, thereby removing some of the Federal Reserve’s power to cut interest rates if needed to stimulate the economy in the coming months. 

2.    Investors head into the weekend with two key inflation reports ahead next week: the Labor Department's January Consumer Price Index (CPI) and Producer Price Index (PPI).

SPX sectors in play

Seven out of the 11 sectors in SPX closed with weekly gains. Mega-cap tech(XLK) and communications services(XLY) companies continued to lead the upside. Arm Holdings (ARM) and Palantir Technologies (PLTR) surged 62% and 43% respectively in the week. While Consumer Staples(XLP) and Utilities(XLU) stocks lagged. Refer to below SPX sectors ETF weekly performance table.

Indexes technical levels

SPX posted its third consecutive daily record close and settled above 5,000 for the first time ever Friday as big technology shares extended a march higher and investors remained buoyed by the outlook for the economy and interest rates. The index closed its 14th weekly gain out of the last 15. The DJI which posted a record high Thursday, finished with a slight loss Friday despite a 1.5% gain in member Microsoft (MSFT). Click below three indexes for their weekly charts respectively.

DJI weekly chart

SPX weekly chart

Nasdaq weekly chart

China/HK

Stocks in China rallied in a holiday-shortened week as the government’s latest raft of stimulus measures offset concerns about deepening deflation. The Shanghai Composite Index(SSE) gained 4.97%, while the blue chip CSI 300 added 5.83% for the week ended Thursday. Markets in mainland China are closed for the Lunar New Year holiday from Friday, February 9, and resume trading on Monday, February 19.  In Hong Kong, the benchmark Hang Seng Index rose 1.37%. (Refer to the above weekly performance table).  

Key highlights for the week and outlook for China/HK:

1.    Deflation risk. The consumer price index fell 0.8% in January from the prior-year period, accelerating from December’s 0.3% drop and marking its fastest decline since 2009. Food prices led the contraction as pork prices declined. Core inflation—which strips out volatile food and energy costs—rose 0.4%, its weakest rise since June 2023. The producer price index declined 2.5% from a year ago, marking the 16th consecutive month of deflation for factory gate costs. 

2.    January’s Caixin/S&P Global survey of services activity fell to a weaker-than-expected 52.7 from December’s 52.9 as new orders fell, although the gauge stayed in expansionary territory for the 13th straight month. 

3.    The People’s Bank of China said in its latest quarterly policy report that it would keep policy support flexible and precise to boost domestic demand. The central bank also forecast that consumer prices would “rebound modestly.” Many economists predict that Beijing will introduce further stimulus measures as the world's second-largest economy grapples with a property market downturn, weak consumer demand, and deflationary pressures.

Click below title to view weekly charts.

SSE weekly chart

.HSI weekly chart

Singapore

STI slipped 1.30% in the quieter week ahead of Chinese New Year holiday. The index has been largely trading within its four-week trading range from 3211 to 3127 level- in sideway consolidation mode. JMH +4.27% and DBS+0.99% were among top weekly gainers, while Seatrium -13% and Wilmar-6.49% were among top losers.

STI weekly chart

Source: Some contents and data excerpted from various public market reports.