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Large Speculator Positions in S&P 500 for Week Ended January 26

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Jan. 30 2018, Published 8:27 a.m. ET

S&P 500 index continues to rise

The S&P 500 index (SPY) posted solid gains in the week ended January 26, 2018, helped by impressive earnings reports and a well-received speech by President Trump at the World Economic Forum in Davos, Switzerland, on January 17. The S&P 500 index closed at 2,872.87 that week, rising 2.2% from the previous week’s close.

Looking at individual sector performances, we see there was no a single sector that posted negative returns last week. The charge was led by the healthcare (XLV) and telecommunications (XTL) sectors.

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Speculators increase bullish positions

For the week ended January 26, large speculator positions in the S&P 500 (IVV) index increased their bullish positions for the second consecutive week. Net-bullish positions increased to 29,980 contracts from 23,698 contracts as of January 23, as reported by the CFTC (Commodity Futures Trading Commission) through their weekly COT (Commitment of Traders) report. Large speculators include hedge funds, otherwise known as smart money.

Outlook for the S&P 500 Index

This week, the focus of investors could stay on earnings. Key companies reporting earnings this week include Microsoft (MSFT), Facebook, Google, AT&T, Pfizer, and Amazon. These major corporations make up a bulk of the indexes, and any surprises in their earnings could sway the markets on either side.

There are also a few important economic events, including the FOMC (Federal Open Market Committee) meeting and the US non-farm payrolls data, but they’re not likely to have any impact on the US equity markets, at least during this earnings season. President Trump’s State of the Union address on Tuesday, January 30, 2018, could be another key event this week, as any talk about infrastructure spending and trade barriers could impact related industries.

In the next part of this series, we’ll see why the US dollar index fell to a multiyear low last week.

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