Equity Market Insight from Nasdaq MID - October 16 2017

Monday, October 16, 2017, 11:45 AM, EST

• NASDAQ Composite +0.24% Dow +0.18% S&P 500 +0.11% Russell 2000 +0.1%
• NASDAQ Advancers: 1087 Decliners: 1125
• Today's Volume (100 day avg) -14%

For the 5 ^th consecutive week, the S&P 500 finished higher and this week opened marginally to the upside. Geopolitical concerns in the Middle East have Crude Oil prices advancing, making Energy one of the four sectors in the green today as stocks hover near unchanged levels. Investors have been waiting for Republicans to make progress on Tax cuts and/or reform. Progress on this front might already be discounted in equities price but could be a driver for stocks to move higher or a source of disappointment if no legislation is passed.

• Oil has moved to its highest level in 2 weeks as tension in response to Iraqi soldiers seizing a refinery in the northern part of the country. The conflict between Iraq and the Kurds has halted the production output in the area, triggering BAML to raise their 4 ^th quarter WTI and Brent Crude price outlooks.
• Netflix is slated to report results this afternoon, with the stock is coming off a 21% gain last quarter. Analysts have been raising their expectations, as the company should see increasing subscriptions helping by strong growth overseas. Tomorrow morning, United Health, Johnson & Johnson, Morgan Stanley and Goldman Sachs will grab the headlines after releasing their 3Q financials.
• The US Empire State Manufacturing Survey for October was higher (30.2) than anticipated (20.4), suggesting that factories are on a strong pace to close out 2017. The weakening US Dollar might have encourage overseas demand for manufactured goods, as the read came in at its highest level since the 2 ^nd half of 2014.

Technical Take:

Crude oil is again testing the declining resistance line in place since May 2015. This trendline has been tested on numerous occasions over the last two plus years which only affirms its growing importance. Crude rallied 26% from its June low to September high where it last tested this resistance, but again it failed to break through. It has since spent the last three weeks working off overbought technicals where the daily RSI has reset from a high of 70 to a recent low of 46. With momentum readings now at more normalize levels, crude is now in a better position for breakout and potential run. That said there is likely a formidable amount of resistance from here up to the YTD highs at $55.24 (WTI).

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Nasdaq's Market Intelligence Desk (MID) Team includes:

Michael Sokoll, CFA is a Senior Managing Director on the Market Intelligence Desk (MID) at Nasdaq with over 25 years of equity market experience. In this role, he manages a team of professionals responsible for providing NASDAQ-listed companies with real-time trading analysis and objective market information.

Jeffrey LaRocque is a Director on the Market Intelligence Desk (MID) at Nasdaq, covering U.S. equities with over 10 years of experience having learned market structure while working on institutional trading desks and as a stock surveillance analyst. Jeff's diverse professional knowledge includes IPOs, Technical Analysis and Options Trading.

Steven Brown is a Managing Director on the Market Intelligence Desk (MID) at Nasdaq with over twenty years of experience in equities. With a focus on client retention he currently covers the Financial, Energy and Media sectors.

Christopher Dearborn is a Managing Director on the Market Intelligence Desk (MID) at Nasdaq. Chris has over two decades of equity market experience including floor and screen based trading, corporate access, IPOs and asset allocation. Chris is responsible for providing timely, accurate and objective market and trading-related information to Nasdaq-listed companies.

Annie O'Callaghan is Director on the Market Intelligence Desk (MID) at Nasdaq. Annie has worked for NASDAQ in a variety of roles including support of Nasdaq C-level management in client retention and customer service. Annie also served as a Sales Director in Nasdaq's Transactions Services business. Prior to joining Nasdaq, Annie worked at AX Trading, managing accounts for its Alternative Trading System and served on Credit Suisse's trading desk as an Electronic & Algorithmic Sales Trading Analyst.

Brian Joyce, CMT has 16 years of trading desk experience. Prior to joining Nasdaq Brian executed equity orders and provided trading ideas to institutional clients. He also contributed technical analysis to a fundamental research offering. Brian focuses on helping Nasdaq's Financial, Healthcare and Airline companies among others understand the trading in their stock. Brian is a Chartered Market Technician.

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