The major U.S. indexes were mixed over the past week, with industrials in the Dow Jones Industrial Average outperforming small-cap stocks in the Russell 2000. November non-farm payrolls rose 228,000, which exceeded consensus estimates calling for 190,000, while average hourly earnings rose a better-than-expected 0.2% for a 2.5% annual pace. Meanwhile, the ADP Employment Report came in at 190,000, slightly above a consensus estimate of about 186,000 for the month.
International markets were flat or in positive territory over the past week. Japan's Nikkei 225 was unchanged; Germany's DAX 30 rose 2.27%; and Britain's FTSE 100 rose 1.31%. In Europe, the Eurozone economy expanded by 0.6% during the third quarter, which points to a stronger-than-expected year. In Asia, Japan's economy expanded at a 2.5% annual pace between July and September, which is up from an earlier estimate of 1.4% growth. Despite these gains, investors remain concerned over the rising threat from North Korea.
The SPDR S&P 500 ETF (ARCA: SPY) rose 0.4% over the past week. After nearly reaching its pivot point at $262.23, the index rebounded towards the upper end of its price channel this week. Traders should watch for a breakout to upper trendline and R1 resistance at $268.83 or a move lower to retest the pivot point or hit lower trendline support at $260.00. Looking at technical indicators, the relative strength index (RSI) moved back into overbought territory at 72.03, while the moving average convergence divergence (MACD) remains in a bullish uptrend dating back to late November. (See also: 77% of Investors Worried About Market Bubbles in Survey.)
The SPDR Dow Jones Industrial Average ETF (ARCA: DIA) rose 0.48% over the past week, making it the best performing major index. After moving off of its trendline resistance, the index rebounded slightly this week toward the upper half of its price channel. Traders should watch for a move to upper trendline and R1 resistance at $246.86 or a move lower to retest the pivot point at $239.47. Looking at technical indicators, the RSI appears lofty at 75.33, but the MACD remains in a bullish uptrend that dates back to late November.
The PowerShares QQQ Trust (NASDAQ: QQQ) rose 0.14% over the past week. After briefly hitting S1 support at $151.72, the index rebounded above its pivot point to the upper half of its price channel. Traders should watch for a move to upper trendline and R1 resistance at $157.64 or a move lower to retest S1 support and the 50-day moving average. Looking at technical indicators, the RSI appears neutral at 56.06, but the MACD remains in a bearish downtrend that dates back to late November. (For more, see: FANG Stocks Getting Sold in Late-Year Rotation.)
The iShares Russell 2000 Index ETF (ARCA: IWM) fell 1.05% over the past week, making it the worst performing major index. After nearing its 50-day moving average at $149.49, the index trended sideways throughout the week for the most part. Traders should watch for a rebound toward upper trendline and R1 resistance at $157.30 or a breakdown below the 50-day moving average to lower trendline and S1 support at $147.25. Looking at technical indicators, the RSI appears neutral at 56.24, while the MACD is trending sideways.
The Bottom Line
The major indexes were mixed over the past week, with tech and small-caps trading at neutral levels and industrials and S&P 500 components trading at lofty levels. Next week, traders will be closely watching several different economic indicators, including the FOMC meeting announcement on Dec. 13, retail sales on Dec. 14 and industrial production on Dec. 15. (For additional reading, check out: 12 Forces May Kill Stocks Despite Tax Reform Euphoria.)
Note: Charts courtesy of StockCharts.com. As of the time of writing, the author had no holdings in the securities mentioned.