Oil stained the stock averages again on Thursday yet early indications today leave Wall Street on track for roughly 1.8% to 3% weekly gains. The broader market wraps up a wild and crazy week with a chance to snap what had been three straight weekly declines as participants slowly accept a Federal Reserve who will no longer officially be “patient” with interest-rate hikes but who’s not in any big hurry to reverse ultra-loose monetary policy.
Still, the path to the closing bell may have a few ruts as today lacks fresh economic news and marks the final trading session for the expiration of stock index futures, stock index options, stock options and single stock futures—quadruple “witching” as it’s known. Even with said late-week volatility, many participants will likely be eyeing the broad-based S&P 500 (SPX) as it continues to knock around the closely watched 2100 line. Early indicators Friday show SPX could challenge this number today. Consider a close above 2100 a victory for the bulls, especially given this week’s grind; it would put record territory within close reach.
Apple’s Influence. Apple (AAPL) joined the Dow Jones Industrial Average this week and in my opinion is likely to give the blue-chip DJIA more utility as a broad-market barometer. Because Apple’s ups and downs can set the tone for the broader tech space, it’s still likely to influence the tech-studded NASDAQ Composite (COMP) and that means the DJIA and COMP could see stronger correlation.
One View. Credit Suisse said in a note that while the Fed’s statement this week leaned dovish, analysts at the firm still expect a rate hike in June. Credit Suisse lifted its projection for the S&P 500 by 20 points to 2,170 by the end of 2015 because it expects corporate credit to improve along with global earnings. That’s a fundamental picture that could help unhinge the stock market from the daily/weekly fluctuations of oil and a strong dollar.
On Tap Next Week. Prep for a data deluge in the first full week of spring, with something of relative importance hitting the tape nearly every day. That includes producer inflation numbers, durable goods data for a snapshot of factory activity and big-ticket business and consumer demand, plus a sprinkling of numbers from the always important housing market—a sector of the economy that’s been hardest to get our arms around. The busy week is capped by Friday’s release of the all-inclusive economic measure, GDP. This is the final reading for Q4 after an earlier, revised estimate was trimmed to 2.2% from 2.6%.