SPX: pricing the soft landing

The US equity markets were traded in a mixed manner during the previous week. On one side there should be considered funds outflows to China's stocks, after the announcement of significant stimulus measures by their Government. In anticipation of non-farm payrolls data, the S&P 500 was traded with a negative sentiment, moving from the level of 5.760 down to 5.680. Still after a release of 254K of new jobs in the US economy in September, which was far above the market expectation, the optimism was back on the market. The Index ended the week at the level from the beginning of the week, 5.751. Majority of analysts are now in agreement that a soft landing for the US economy is the most likely scenario, and that the US economy is more resilient from their initial expectations.

Tech mega-cap companies were the ones that led the market to the upside on Friday's trading session, followed by companies from the financial sector. As per analysts, the financial sector is expected to gain during the following period, as an environment of decreased interest rates would support the credit activity. In this sense, JPMorgan and WellsFargo gained more than 3% for the week. Additional support for the index rally on Friday came from oil companies included in the S&P 500. Namely, as tensions in the Middle East continue, the price of oil has increased bringing companies within this sector higher by 7%.