Stock Market Outlook for Fri Jan 31 2025 – Choppy – Dip Possible But Still Up

Prior Trading Day Summary:

On Thursday stocks started the day weak and by 11:00 the SPX had slipped to 6027 but with limited downside pressure, investors bought into stocks and by 3:30 the SPX was up to 6086. The last half hour saw a deep dip that took the SPX down to 6040 followed by a rapid push higher in the final 15 minutes to see the SPX end the day up 32 points to 6071. It was the last 15 minutes of buying that turned what would have been a negative close, into a positive one.  74% of all volume was to the upside and 77% of all stocks were rising.

The NASDAQ also managed to rally in the last 15 minutes to close up 49 points to 19,681. 69% of all volume was rising by the close along with 65% of stocks. Overall the day saw fairly broad-based move higher for equities.

After hours the highly anticipated earnings from Apple were disappointing on China sales but with many investors already prepared for poor numbers out of China, they bought the stock after hours. The question for Friday will be whether investors will buy the stock or take a wait-and-see approach.

Let’s review the technical indicators at the close on Thu Jan 30 2025 to see what to expect for the final trading day of January.

Stock Market Outlook: SPX Closing Chart For Thu Jan 30 2025

The index closed above the 50 and 21 day moving averages. This is bullish.

The closing candlestick has two long shadow which signals both a dip and a spike are likely intraday. We could see a spike to start the day but then a dip as the day progresses. The candlestick is bullish however.

The 21 day moving average is rising and closed at 5968 but it is still trading below the 50 day which is bearish.

The 50 day moving average is rising and closed unchanged at 5986 which is bullish.

The 100 day moving average is rising and closed at 5860 which is bullish.

The 200 day moving average is rising and closed at 5632 which is bullish.

The Lower Bollinger Band is falling which is bullish at present. The Upper Bollinger Band is rising which is bullish.

For Friday the SPX chart is more bullish than bearish for Friday.

SPX Stock Market Outlook review of Thu Jan 30 2025

Stock Market Outlook: Technical Indicators Review

Stock Market Outlook for Fri Jan 31 2025 

For Friday the open should be higher or see a bounce. As the day progresses we could see stocks slip slightly. Apple stock is important for Friday. If it climbs and remains steady, the indexes should have no trouble closing higher. If investors decide to sell the stock lower, I think we may find ready buyers who will push the stock back up.

On Friday investors get the latest Personal Consumption Expenditures (PCE) numbers. Estimates have the number rising in both income and spending which is often seen as inflationary. This might weigh on stocks, but if bonds move higher again on Friday, stocks may feel some pressure.

Overall for Friday the outlook is for a higher close.

January closed higher as did the first 5 days of the month. Historically when the month of January and first five days end higher, the SPX has been higher by the end of the year 44% of the time when there has been no “Santa Claus Rally” according to my re4cords since 1974.

Economic reports on Thursday were less encouraging with the GDP falling to 2.3% instead of rising. This is distinct drop from the 3.1% prior. Also the Weekly Initial Unemployment Insurance Claims fell to 207,000 which was well below estimates of 228,000 and 223,000 prior. The biggest surprise though was pending home sales which dove to -5.5% from an expected 0.3% and from 1.6% prior. All 3 major economic reports on Thursday were a surprise.

Potential Economic and Political Market Moving Events

Monday:

10:00 New home sales for December rose to 698,000 beyond all estimates.

Tuesday:

8:30 Durable goods orders were lower than estimated coming in at -2.2%

9:00 S&P Case-Shiller home price index rose as estimated to 4.3% from 4.2%

10:00 Consumer confidence fell to 104.1 from 109.5 prior.

Wednesday:

8:30 Advanced trade balance in goods was estimated at -$103.5 billion but stunned coming in at $122.1 billion which many analysts felt could be inflationary.

8:30 Advanced retail inventories came in as estimated at 0.3%

8:30 Advanced wholesale inventories were lower than estimated at -0.5% -0.2%

2:00 FOMC interest rate decision

2:30 Fed Chair Powell press conference

Thursday:

8:30 GDP is slipped lower than expected to 2.3%

8:30 Weekly Initial Unemployment Insurance Claims were lower than expected at 207,000 versus 228,000 estimated

10:00 Pending home sales plunged -5.5% which was well below estimates of 0.3%

Friday:

8:30 Employment cost index is estimated to rise to 0.9% from 0.8%

8:30 Personal income for December is estimated to rise to 0.4% from 0.3% prior

8:30 Personal spending is estimated to have risen to 0.6% from 0.4% for December

8:30 PCE Index is estimated to rise to 0.3% for Dec from 0.1% prior

8:30 PCE year-over-year is estimated to rise to 2.6% from 2.4% prior

8:30 Core PCE Index is estimated to rise to 0.2% for Dec versus 0.1% prior

8:30 Core PCE Index year-over-year is estimate to remain unchanged at 2.8%