The retreat continues from just under 1900 in the S&P 500

US markets look set to open lower today after Friday’s US unemployment miss caused a sell-off in global markets. Looking ahead this week it is the release of the FOMC meeting minutes and the beginning of earnings season. Futures suggest the S&P500 will open 5 points lower at 1,860 with the Dow Jones expected to open 34 points lower at 16,386. With no major US data, today’s session will likely focus on the longer-term ramifications of Friday’s job report on future US economic growth prospects and the resulting policy reaction from the Fed. US stocks had been trading higher in the week after been given renewed faith in the dovishness of Fed Chair Yellen and her apparent determination to keep policy easy despite improving US data following the cold-spell. The NFP result has not really changed this situation. While the report may have missed exaggerated expectations on the day, the report was largely positive showing close to 200k jobs created in March and significant upward revisions to previous months. The Fed will likely still be tapering at the same rate and headline numbers imply the US economy is still steadily recovering. A market correction after touching a round number like 1900 is to be expected so when the NFP report pushed the S&P 500 to 1897, investors got out of the market en masse before the weekend. 1,850 will probably need to hold if the market is to maintain the short-term uptrend in prices. Should the level fail, this would be the first time in months that US markets has corrected as a result of fundamental data rather than geopolitical events internationally. It will remain to be seen if this speaks to a larger change in sentiment towards the overall context of US growth and Fed tapering. Grubhub will see its second day of trading today following a successful IPO on Friday where investor demand pushed the price to close 31% higher. Online brokers E*Trade Financial, Charles Schwabb and TD Ameritrade will likely be in focus again this week with any further developments around the investigation into high-frequency trading (HFT) by the US Department of Justice. The brokers have been getting an increasing amount of revenue from the order flow of HFT players. CMC Markets is an execution only provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.