Key Inflation Data Looms as S&P 500 Extends Gains

The S&P 500 registered a solid advance on Thursday, climbing 0.6% to close at 6,738.44 points. Market optimism was fueled by a combination of rising oil prices following fresh US sanctions on Russian petroleum firms and a wave of encouraging corporate earnings reports. In parallel moves, the Nasdaq Composite jumped 0.9%, while the Dow Jones Industrial Average added 0.3%.

Market Leaders and Laggards

The energy and financial sectors emerged as the primary drivers of the rally, whereas consumer staples and real estate segments retreated.

Notable individual stock movements within the index included:
* Dow Inc. soaring 13%
* Las Vegas Sands advancing 12.4%
* West Pharmaceutical Services jumping 10.9%
* APA Corp. gaining 7.6%
* Honeywell International climbing nearly 7%

In contrast, Molina Healthcare was a significant decliner, plunging 17.5% after the company revised its profit forecast downward.

Should investors sell immediately? Or is it worth buying S&P 500?

Bullish Technical Backdrop Persists

From a technical standpoint, the outlook for the S&P 500 remains predominantly positive. The index is currently trading above its key moving averages—the 20-day exponential moving average (EMA) at 6,671 and the 50-day EMA at 6,574. However, it remains positioned below a significant ascending trendline, presenting a cautionary signal for bullish investors.

Analysts identify immediate resistance in the 6,716-6,723 zone, with subsequent hurdles at 6,842 and the upper channel boundary near 6,900-6,920. The all-time high of 6,766 marks a particularly critical resistance level. On the downside, initial support is situated in the 6,670-6,680 range, reinforced by the 21-day EMA.

All Eyes on Inflation Report

Market focus is now squarely on the delayed US inflation report scheduled for release today. A reading that comes in hotter than anticipated could temper market expectations for aggressive interest rate cuts from the Federal Reserve, potentially triggering a fresh wave of volatility.

Despite this, the underlying bullish trend, supported by robust quarterly earnings and a perceived relaxation in geopolitical trade tensions, is likely to continue fostering a “buy-the-dip” mentality among investors. Furthermore, ongoing Federal Reserve discussions concerning quantitative tightening and future interest rate policy are expected to significantly influence market sentiment in the sessions ahead. The critical question remains whether the S&P 500 can successfully breach its record high in today’s trading.