The major stock indices found support during yesterday’s session, after falling for four sessions straight. The bounce came despite negative economic data from the U.S, as the OECD released a statement mentioning that the economic recovery is arriving quicker than expected, but activity will remain weak. Furthermore according to their expectations the group of seven countries (G7) will continue to show negative growth of 3.7%, less than their projection of 4.1% in June.
On the data front, Initial claims disappointed coming out at 570k, while the ISM Non-Manufacturing Index came out just under market expectations of 48.5, at 48.4 points. Even though the data had a slight impact on the intraday session, investors brushed it aside, preparing for today’s major event.
From a technical point of view the S&P500 retraced breaking its secondary trend line. One must note that the current retracement is still only classed as a correction, something that could come down as far as the 975 level.