Lower start seen on payroll news
U.S. stocks are expected to open modestly lower, pressured by a dreadful look at the U.S. employment situation as non-farm payrolls shed more jobs than any month in the last 34 years and the unemployment rate climbed to 16-year highs. The bleak jobs picture was expected to overwhelm overseas gains for banks, automakers and chip stocks. The Dow was called 30 points lower, while the Russell 2000 (NYSE:IWM) was seen slightly lower, near 454.00.
Overseas markets appeared to get a lift from expectations that details of the U.S. stimulus plan will be rolled out Monday, which helped European shares look past weak economic data on manufacturing in Germany and in the U.K. On the U.S. company front, Bank of America Corp. (NYSE:BAC) was expected to jump on the opening today following an analyst giving a “strong buy” rating on the stock.
Crude oil futures were down about $1.50 dollars a barrel into the jobs report, slipping below $40 dollars amid concerns about global demand. If you’re wondering what the deal is with the wide and inverted spread between global crude oil quotes, U.S. crude prices are trading at a hefty discount to London spot prices because of a glut of supplies at the delivery location in the U.S. for crude.
The chart structure has eased into a mini-trading range within the elongated extended trading range. This new mini-range is defined by 474 on the upside and 431 on the downside. For today’s session, look for support at 450, 444.50 and 439.50. Meanwhile, resistance comes in at 460 and 466.
