The SPDR S&P 500 ETF Trust (SPY) gained 0.94% on Tuesday. The positive momentum was driven by rising Federal Reserve rate-cut expectations and strong earnings reports from retail companies, including Kohl’s (KSS) and Best Buy (BBY).
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Within SPY’s holdings, Healthcare, Consumer Discretionary, Communication Services, and the Consumer Staples sector posted gains today, while the Energy and Utilities sectors declined the most.
Importantly, SPY closely tracks the S&P 500 Index (SPX), which was up 0.91%, while the tech-heavy Nasdaq 100 (NDX) gained 0.58%.
Key Catalysts That Can Move SPY
Key economic reports such as the September Durable Goods Orders, initial jobless claims, and the Fed’s Beige Book will be closely watched for insight into the economy’s health.
Also, several Fed officials are scheduled to speak, and their comments on interest rates will likely influence investors’ sentiment.
Importantly, U.S. markets will be closed on Thursday for the Thanksgiving holiday and will also close early on Friday. This shortened trading week often results in higher volatility with lower trading volumes.
Fund Flows and Sentiment
SPY’s 5-day net inflows totaled $2 billion, showing that investors put capital into SPY over the past five trading days. Meanwhile, its three-month average trading volume is 79.01 million shares.
It must be noted that the retail sentiment for the SPY ETF is positive, while hedge fund managers have decreased their holdings of the ETF in the last quarter.
SPY’s Price Forecast
According to TipRanks’ unique ETF analyst consensus, which is based on a weighted average of analyst ratings on its holdings, SPY is a Moderate Buy. The Street’s average price target of $777.77 for the SPY ETF implies an upside potential of 15.22%.
Revealingly, SPY’s ETF Smart Score is a seven, implying that this ETF is likely to perform in line with the broader market.
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