Energy and financial stocks lead a July kick-off rally and upbeat manufacturing data boosts market sentiments ahead of U.S. holiday

Just ahead of the Fourth of July holiday, a shortened session of trading is seeing a round of gains in the Dow Jones Industrial Average index. The Dow hit an intraday record at 21,546.82.  A satisfactory report on manufacturing data has also boosted market sentiments, following a series of underwhelming economic data in past weeks. The ISM manufacturing index climbed to 57.8 for the month of June, which is a gain from 54.9 for the month of May. Any index reading above 50 can be read as an indication of expansion. Trading on the New York Stock Exchange will ends at 1 p.m Eastern, and will be closed on Tuesday for the holiday.

Tesla Inc. (TSLA) saw a 1.7% hike in share prices following an announcement from its CEO, Elon Musk, that production of its highly anticipated Model 3 car is two weeks ahead of production schedule. The Model 3 will be Tesla’s most affordable vehicle, priced around $35,000. Shares are currently down 2.48% at $352.63

The DJIA is currently up 0.93%, or 199.07 points, at 21,549. The Nasdaq-100 is down 0.18% at 6,130 and the S&P 500 is currently trading at 2,437 which is up 0.55% from the open.

Using the ^GSPC symbol to analyze the S&P 500, our 10-day prediction window shows  incrementally building negative signals. Today’s negative vector figure of -0.09% progresses to -0.25 within three trading sessions. Today’s predicted support and resistance is 2,413.29 (± 3.77) and 2,437.79 (± 3.81), respectively. The predicted close today is 2,423.64. Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.   

Oil

Crude oil prices are continuing gains, following the first report of declining domestic U.S production since January. Heavy U.S output has worked against OPEC efforts to reduce the global oil glut, and has dragged down prices. Although U.S production decline and falling rig counts are boosting market sentiments, many are looking at this as a temporary halt due to a tropical storm in the Gulf of Mexico.  West Texas Intermediate for August delivery is currently priced at $46.80 per barrel, up 1.65% from the open.  

Looking at USO, a crude oil tracker, our 10-day prediction model shows initial downward movement followed by positive corrections. The fund is currently trading at $9.62, which is up 1.32% from the open. Today’s prediction sees support at $9.27 (± 0.06) and resistance at $9.52 (± 0.06). The predicted close for today is $9.46. Vector figures show +0.39% for today, turning downward for three additional sessions before seeing positive corrections. Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.   

Gold

The price for August gold is currently down 1.61% at $1,222.30 a troy ounce. Gold prices saw their first monthly declines since March, and stock market rebounds are causing investments to rotate into risk-assets. An overall strengthened U.S dollar has also contributed to slides in the non-fiat metal. Gold becomes less attractive to investors holding foreign currencies when U.S dollar is strengthened, as it is priced in that currency.

Using SPDR GOLD TRUST (GLD) as a tracker in our Stock Forecast Tool, the 10-day prediction window shows overall positive movement after initial negative signals. The gold proxy is currently trading at $116.23, down 1.52% from the open. Today’s predicted low is $117.97 (± 0.27) and the predicted high is $118.73 (± 0.27). The predicted close today is $118.46. Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.   

Treasuries

Treasury yields are rebounding after early market dips preceding the ISM manufacturing report, which turned out to be an upbeat report. Hawkish commentary from the European Central Bank and Bank of England has spurred a bond sell-off last week, as investors are now anticipating a normalization of monetary policy. Investors will dump lower-yield bonds in this type of climate in order to purchase new bonds with higher yields. The yield on the 10-year Treasury note is currently up 3.24% at 2.35%. Bond prices and yields are typically inversely related to one another.

Using the iShares 20+ Year Treasury Bond ETF (TLT) as a proxy for bond prices in our Stock Forecast Tool, we see strong negative movement in our 10-day prediction window. Today’s vector figures move from -0.37% to -1.68% in three trading sessions.  The ETF is currently priced at $124.26- down 0.48% from the open. The predicted close today is $124.45 with a low and high of $124.00 (± 0.26) and $125.12 (± 0.27), respectively.  Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.

Volatility

The CBOE Volatility Index (VIX) is currently down 2.24% at 10.93, and our 10-day prediction window shows overall positive signals. The predicted close today is 11.30 with a positive vector of +3.09%. Today’s predicted lows and highs are 10.61 (± 0.30) and 12.06 (± 0.34), respectively. Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.