The S&P futures leapt to finish with more extraordinary gains after Housing Starts and Building Permits came in better than expected. Since the economic crisis was triggered by the downfall of the U. S. housing market, any uptick in residential construction serves as a strong catalyst to the upside.

However, the surprisingly optimistic number was driven by an increase in the construction of apartment buildings. With a staggering amount of foreclosures, there should be no shock that more families are opting to live in multi-bedroom apartments to weather the storm in residential and credit markets.

The production, manufacturing and employment data points are resoundingly negative around the globe. To highlight this statement, Britain announced a jaw-dropping 138,400 claimant count number compared to analyst expectations of a 84,500 rise in unemployment claims.

Hence, while America may be stabilizing a bit in some areas, the economic downturns in Europe and Asia are just picking up steam. Since the global economy is so intertwined, we could witness what we would like to call refraction. The massive economic tsunami created by the U. S. is striking Europe and Asia.

While the policies enacted by the U. S. government may be helping stabilize its domestic economy, we could see the wave refract and head back towards America, delivering yet another blow to an already beleaguered economy. Therefore, even though U. S. equities are exhibiting a furious rally right now, we can't keep our eyes off of the troubling data/news coming from Europe and Asia.

As mentioned in our previous postings, we take optimistic claims from bank CEOs with a grain of salt these days. What matters in the end are quarterly earnings, not what happens the first two months of the year. Meanwhile, the S&P futures are being blocked by our 3rd tier downtrend line with the highly psychological 800 level within reach.

As a result, we would not be surprised to witness some near-term consolidation. The U. S. will release more critical economic data today, including CPI and the Current Account. Even though the PPI was reported in-line with expectations yesterday, a negative CPI could deflate the sails of the rally in equities.

The correlations are still waiting on the S&P to make up its mind on whether to commit to a serious uptrend. Fundamentally, we find resistance of 761.5 with additional resistances hanging at 765.5, 772.25, and 776.75.

To the downside, we see support of 755.5 with additional supports sitting at751.75, 748, and 744.

The S&P futures are currently trading at 757.25.

Copyright 2009 FastBrokers, Latest Forex News and Analysis for Forex, Bullion and Commodity Traders.

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