With not too much resistance, the S&P 500 index futures have now easily eclipsed last week’s high with a healthy rally during Tuesday’s session, being instigated by somewhat better-than-expected inflation data.
As overnight trading commenced, neither the bulls or bears started out with a firm lead. However, as the early morning hours progressed, the bulls found their way past Monday’s high to the 5400 area. Unfortunately for them, the bulls couldn’t hold a bid above Monday’s high, and the bears took the index futures straight back down to Monday’s closing area. The good news is that support held firm at the double close, and the bulls started their comeback. At 8:30am EDT, July’s Producer’s Price Index (PPI) came in somewhat better than expected, as per the chart below.
| July Report | Actual | Expected | Previous |
| PPI (MoM) | 0.1% | 0.2% | 0.2% |
| PPI (YoY) | 2.2% | — | 2.7% |
| Core PPI (MoM) | 0.3% | 0.2% | 0.1% |
| Core PPI (YoY) | 3.3% | — | 3.2% |
The data instigated a quick pop to a new premarket high, which slightly retreated before the regular session open. Off the opening bell, the bulls took control nearly straight away. After breaking above the premarket high, the bears took the index futures back down, testing support at the initial intraday low.
Bulls bought the intraday dip right back up and started a rally that would last the majority of the day. After the lunch hour, resistance was found in the 5450 area, but was overcome in the final minutes to finish the day at new highs. The session concluded near the day’s high at 5459, gaining a healthy 89.25 handles, nearing the high from August 2 (5473.25). Traders and investors also have further inflation data to look forward to Wednesday morning, with July’s CPI and Core CPI expected to be 0.2%
NVIDIA Corp (NASDAQ: NVDA) emerged as the biggest gainer for the second day in a row among top components. The chip designer was able to advance by $7.12 or 6.53% to close at $116.14 for the day.
That performance was over three times better than the cash index’s advance of 1.64%.
There were no losers among the top components, therefore the smallest winner was Berkshire Hathaway Inc Class B (NYSE: BRK.B). For the day, the holding company advanced by $2.02 or 0.47% to close at $432.41.
