Good morning. Nice little long yesterday though the bullishness was fairly short lived and 6840 proved a bit too optimistic! Apple missed with its results last night, along with a record loss for Microsoft, so we have had overnight weakness though none of it is unexpected really, as a pull back is required to the 25ema on the dailies of the various indices. 6716ish for the FTSE, 2100 S&P and 11400 Dax I am looking at for support.
US & Asia Overnight from Bloomberg
Asian stocks fell, with the regional benchmark index retreating from a two-week high, as technology-related shares declined after companies including Apple Inc. and Microsoft Corp. reported disappointing results.
The MSCI Asia Pacific Index fell 0.5 percent to 144.56 as of 9:08 a.m. in Tokyo. U.S. equity-index futures slipped as Apple tumbled more than 6 percent in extended U.S. trading after missing analysts’ estimates for revenue and iPhone shipments. Microsoft fell 4 percent on its record net loss.
“Markets are going to get more volatile,”said Nader Naeimi, head of dynamic asset allocation at AMP Capital Investors Ltd. in Sydney. “The earnings season in the U.S. is going to be quite weak. Investors are expecting too much from Apple, and that’s already reflected in the share price. How much more improvement can Apple deliver unless they introduce a radically different product from what competitors like Samsung are offering?”
Japan’s Topix index fell 0.9 percent. South Korea’s Kospi index slid 0.5 percent. Australia’s S&P/ASX 200 Index dipped 0.9 percent, while New Zealand’s NZX 50 Index added 0.4 percent. Markets in China and Hong Kong have yet to open.
The Shanghai Composite Index advanced for a fourth day on Tuesday, finishing above 4,000 for the first time since July 1 and capping its longest stretch of gains since May. Smaller companies extended a bull-market rally and speculation grew the government’s market-support measures have contained excessive price swings.
U.S. Futures
The Chinese benchmark has rebounded 15 percent since July 8, following a month-long rout that cost shareholders almost $4 trillion, as policy makers introduced a spate of measures to bolster equities. The Shanghai index on Monday posted the smallest price swings since the rout began.
E-mini futures on the Standard & Poor’s 500 Index dropped 0.4 percent. The U.S. equity benchmark index retreated 0.4 percent on Tuesday.
The S&P 500 had rallied 4 percent since a low on July 8, reclaiming almost all of its losses that stemmed from worries over Greece’s debt crisis and China’s market rout. The easing of those tensions sparked the Stoxx 600’s rally that added 9.1 percent and pushed it to within 2 percent of its record.
European Central Bank officials are holding a telephone call on Wednesday to discussthe Emergency Liquidity Assistance that keeps Greece’s financial system alive. They’re about to send a team back to the Greek capital to monitor compliance with austerity policies that the government accepted in return for a bailout deal. [Ref]
FTSE Outlook
We have a few supports around the 6740/6750 area where we are as I write this at half six, so I think we may get a bit of a rise initially from this area. most likely towards the 6760 area. If that holds as resistance then we should be on for a dip down to the daily supports across the board on the FTSE, Dax and S&P. As mentioned above I am looking at the 25ema on them for possible swing longs. Todays pivot is 6770, and just above that 10min channel that I have used for the arrows; that said we also have the 200ema on the 30min at 6774, with the T3 trend line at 6770 so there is a cluster of resistance around this area. Everything is looking fairly bearish to start off with today.