Nasdaq and S&P 500 Futures Diverge as JOLTS Data and Nike Results Spotlight – Invesco QQQ Trust Series 1 (NASDAQ:QQQ), SPDR S&P 500 (ARCA:SPY)

Stocks are bracing for another nervous start on Tuesday after struggling in the previous session, capping a seasonally weak September on a high. Some strategists see September's unusual gains as evidence of the market's resilience. The clear belief is that gains could only continue into the fourth quarter and beyond if the economy can avoid a recession.

Any incoming economic data, including data on job openings and manufacturing activity due Tuesday, would provide clues about the strength or lack of strength of the economy. Since this is the presidential election year, traders are expecting greater volatility at least through November 5th. The market may also have to contend with earnings as they come in the second half of the month.

In pre-market trading on Tuesday the SPDR S&P 500 ETF Trust SPY fell 0.02% to $573.63 and the Invesco QQQ ETF QQQ rose 0.09% to $488.50, according to Benzinga Pro data.

Last week's notes:

US stocks weathered a period of selling pressure to end Monday's session higher. Overbought levels and a slump in some key global markets raised caution early in the session, with major indices mostly moving below the unchanged line for much of the session. After the Fed chair, selling intensified Jerome Powell During his speech, he poured cold water on hopes for a rapid reduction in interest rates.

The major indices recovered late and ended September firmly in the green, with the S&P 500 and the Dow Industrials closing at new highs. Nine of the S&P 500's 11 sector classes closed in the green, with communications services, energy and real estate stocks seeing strong buying interest. On the other hand, stocks from the materials and consumer discretionary sectors fell.

Insights from analysts:

The Fed's larger-than-expected interest rate cut may buy more time for high-quality stocks to remain expensive and even help lower-quality cyclical stocks, especially after recent moves in China, Morgan Stanley's U.S. equity strategist said Mike Wilson. “However, I believe that labor market data and other growth indicators will need to improve to justify these conditions continuing through the end of the year and beyond – i.e. said the strategist.

The market is entering a seasonally strong period after rising in eight of the nine months. Research Director of Fund Strat Tom Lee said in the company's weekly commentary that the following three favorable structural drivers for stocks support “buy the dip”:

• Fed starts easing cycle + “no landing”
• Chinese PBOC bazooka
• Post-election momentum and cash on the sidelines

He pointed out that when the Fed cuts interest rates and the U.S. economy is not in recession, the S&P 500 index is up seven out of seven times both three and six months later.

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Upcoming economic data:

• S&P Global is scheduled to release its final manufacturing purchasing managers' index for September at 9:45 a.m. EDT. Economists on average expect the final manufacturing PMI to come in at 47, down from 47.9 in August.
• The Institute for Supply Management will release its national manufacturing PMI at 10 a.m. EDT. The consensus is for September at 47.5, up slightly from 47.2 in August.
• The Labor Department is scheduled to release the results of its August survey of job vacancies and labor turnover at 10 a.m. EDT. Economists on average expect the number of job vacancies to remain unchanged at July levels, at 7.7 million.
• The Commerce Department's construction spending report for August, due at 10 a.m. EDT, is expected to show flat spending compared to July, which saw a 0.3% decline from the previous month.
• Governor of the Federal Reserve Lisa Cook will make a public appearance at 11:10 a.m. EDT.
• President of the Richmond Fed Tom Barkin, President of the Atlanta Fed Raphael Bostic and President of the Boston Fed SusanCollins are scheduled to participate in a joint panel discussion on technology-based disruptions at 6:15 p.m. EDT.

Stocks in focus:

• Trump Media & Technology Group Corp. DJT As the company announced, the value rose by almost 7.50% in premarket trading It has expanded its TV streaming delivery network to operate in multiple locations.
• Ford Motor Co. F climbed over 2% on positive analyst action.
• Acuity Brands, Inc. AYI, McCormick & Company, Inc. MKC, Paychex, Inc. PAYX And United Natural Foods, Inc. UNFI are among the well-known companies that will publish their quarterly results before the market opens.
• Those reporting after the market close are NIKE, Inc. NKE, Resources Connection, Inc. RGP And Cal-Maine Foods, Inc. QUIET.

Commodities, bonds and global stock markets:

Crude oil futures fell sharply while gold futures rose moderately. Bitcoin BTC/USD traded slightly higher below the $64,000 mark. The yield on the benchmark 10-year Treasury note fell 5.7 basis points to 3.745%.

In Asia, the Japanese market recovered, although sentiment elsewhere remained subdued. Markets in China, Hong Kong and South Korea remained closed for holidays. European stocks were cautious in early trading as traders digested preliminary consumer price inflation data for the euro zone in September.

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