May 20 - Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at markets.research@thomsonreuters.com
MAJOR U.S. INDEXES POISED TO EXTEND WEEKLY LOSING STREAKS (1003 EDT/1403 GMT)
Wall Street's main indexes are higher early on Friday with banks and megacap growth shares rising on the last day of a week that saw heightened volatility on concerns about the impact of rising inflation and interest rate hikes.
In any event, the Dow Jones Industrial Average is still on pace to fall for an eighth-straight week. If so, it would be its longest losing streak since an eight-week run of losses from March-May 1932. The longest weekly losing streak in the Dow's history is a nine-week run of lower closes March-May 1923.
The S&P 500 and Nasdaq Composite are both on track for seven-week losing streaks. If so, it would be the SPX's longest run of weekly losses since an eight-week losing streak in February-March 2001. The Nasdaq had a seven-week losing streak in February-March 2001.
Here is an early trade snapshot:
(Terence Gabriel)
SMALL-CAP RUSSELL 2000 HITS SOME BIG SUPPORT (0900 EDT/1300 GMT)
The Russell 2000 has certainly been cut down to size. The small-cap index lost around 30% of its value from its early-November highs into its lows earlier this month.
However, the index has reached some big support:
Indeed, on May 11, the index closed at 1,718, or less than 6 points, or just 0.3%, from the 50% retracement of the March 2020-November 2021 bull-phase at 1,712.
After hitting an intraday low of 1,701 on May 12, or just 0.7% below the 50% retracement, the index has bounced, and ended Thursday at 1,776, up more than 3% from the May l1 close.
Additionally, the RUT's late-2018 and early-2020 highs at 1,742/1,715 can act as a support zone.
The RUT is also testing its 200-week moving average (WMA) which now resides around 1,773. The 200-WMA has been a long-standing potential magnet ever since the RUT's March 2021 disparity peak at 1.498 - click here:
It now remains to be seen if the 200-WMA disparity reading of around 1.000 can be sufficient enough from which the RUT can launch a renewed advance.
Of note, since the late 1990s, there have been six instances where the RUT's 200-week disparity reading peaked at greater than 1.30 and then collapsed back to and below 1.00, prior to the RUT then bottoming and advancing to new highs.
The 200-week disparity troughs ran from 0.986 to 0.498 with an average of about 0.79, and a median of about 0.82. Thus, a decline to these levels can suggest the RUT, in theory, would need to lose another 20% or so of its value.
That said, this week's current 1.002 reading is very close to 2011's 0.986 print. Additionally of note, if the RUT has now found a major two-day bottom around the 50% retracement of its prior advance, it would be very similar to the 2011 bottom. That bottom occurred at the 50% retracement of the 2009-2011 bull-phase (0.6% above the level with the October 3, 2011 close, and 0.6% below the level with the October 4, 2011 intraday low).
(Terence Gabriel)
FOR FRIDAY'S LIVE MARKETS' POSTS PRIOR TO 0900 EDT/1300 GMT - CLICK HERE:
(Terence Gabriel is a Reuters market analyst. The views expressed are his own)