US stocks closed mixed overnight, with 5 of the 11 sectors closing higher, led by a strong +2.5% advance by the Oil Sector. US Treasuries fell (yields higher), while oil prices rallied, but a strong +0.85% rally by the S&P500 from its intraday lows was impressive after the likes of tech tested our previously flagged support levels. From a technical perspective, the recovery by US stocks was very encouraging as we also deem them to be “looking for a low”, aka the ASX.
- We remain mildly bullish on US stocks short term but are conscious that the bullish advance from Q4 of 2022 is maturing fast.
MM remains cautiously bullish on US tech stocks short-term
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Crude oil rallied more than +2% overnight, taking the December Futures to their highest level since mid-2022. It’s hard to argue with the current advance, although Western governments would do almost anything to reverse the gains as it spurs another leg higher by inflation, e.g. Yesterday’s CPI in Australia. One of our main focuses today will be how well the local Energy Sector reacts to the overnight move. The S&P500 Energy Sector closed up +2.5%, but the local names have been struggling to keep pace.
- We are now looking for a break of 2022’s high by December crude, but a period of consolidation does look overdue.
MM remains bullish on crude oil
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