LIVE MARKETS Dow Industrial Average flirts with record highs

  • Major U.S. indexes green; banks outperform
  • Energy leads S&P sector gainers; tech sole loser
  • Euro STOXX 600 index up ~0.6%
  • Dollar edges up; gold, crude rise; bitcoin down
  • U.S. 10-Year Treasury yield dips to ~1.46%

Dec 28 – Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at markets.research@thomsonreuters.com

DOW INDUSTRIAL AVERAGE FLIRTS WITH RECORD HIGHS (1002 EST/1502 GMT)

The S&P 500 (.SPX) is trading at a record high on Tuesday, building on a four-day rally amid thin trading volumes, with investors unshaken by Omicron-driven travel disruptions and store closures.

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Meanwhile, with its early gain, the Dow Jones Industrial Average (.DJI) is on track to end above its 36,432.22 November 8 record close. The DJI’s intraday record high, also on Nov. 8, stands at 36,565.73.

The Nasdaq Composite, (.IXIC) is around 1% shy of its Nov. 19 record close of 16,057.437. Its record intraday high was on Nov. 22 at 16,212.229.

Of note, at 7.9 billion shares, total volume on U.S. exchanges on Monday was the lowest of the year.

Here is your early-trade snapshot:

earlytrade12282021

earlytrade12282021

(Terence Gabriel)

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S&P 500: ECHOES FROM 1929 AND 2000? (0900 EST/1400 GMT)

The S&P 500 (.SPX) is on track to rise nearly 28% in 2021. With this, its rolling three-year gain now stands at 91%. That’s it’s best such rise since a 98% advance in 1999, which was, of course, just prior to the bursting of the tech-bubble in March 2000.

As 2021 draws to a close, the SPX is nearing a 92-year log-scale resistance line, which has the potential to be a formidable barrier given that it is based off of the index’s 1929 and 2000 peaks read more :

SPX12282021A

SPX12282021A

On a monthly, basis, this line is now around 5,150, or roughly 7% above current levels. Since it is ascending around 25 points per month, it will reside around 5,225 in March 2022, or roughly 9% above current levels. read more

Additionally, monthly momentum is lagging. Since peaking at an all-time high in January 2018, the RSI is failing to confirm the SPX’s fresh record highs:

SPX12282021B

SPX12282021B

In fact, the current 47-month divergence is just slightly longer than the 45-month period from what was then the all-time high monthly RSI reading in June 1996 to the S&P 500’s March 2000 top.

Thus, given the extent of the S&P 500’s three-year advance, the resistance line, and the momentum divergence, early 2022 may be shaping up to be a critical test for the benchmark index.

(Terence Gabriel)

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LIVE MARKETS EUROPE TO RETURN ON DECEMBER 29: read more

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Terence Gabriel is a Reuters market analyst. The views expressed are his own

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