Good morning. Good day yesterday in the end with the dip from the SMS level then long at 6775 for the run to 6820. Didn’t quite manage to reach the top of the daily channels that I was looking for, but to be honest it seems a tall order anyway while the S&P remains below 1991. The trend is still up though, and the top of the Bianca channels are now at 6860. Would have to be a very bullish Friday to reach them today! Still, company results are still on the positive side, but 6825 remains immediate resistance. The IMF upped their latest guess of what they think the UK economy will grow by over this year, changing their mind to increase it to 3.2%, and 2.7% for 2015.
Asia Overnight from Bloomberg
Asian stocks outside Japan dropped, with a gauge of Chinese shares in Hong Kong paring its weekly advance, and U.S. futures slid. Indonesia’s rupiah weakened a second day versus the dollar, while copper trimmed a weekly gain.
The MSCI Asia Pacific excluding Japan Index slipped 0.4 percent by 12:49 p.m. in Tokyo, set for a weekly climb of 1.4 percent. The Hang Seng China Enterprises Index dropped 0.3 percent after surging 5.6 percent in three days. Standard & Poor’s 500 Index futures lost 0.1 percent and Nasdaq 100 Index contracts fell 0.2 percent. The rupiah weakened 0.3 percent as the Bloomberg Dollar Spot Index held near the highest level since June 18. Australian bonds declined and gold headed for a second weekly retreat. Copper fell 0.4 percent.
Global equities are up for a second week, after a raft of better-than-estimated earnings in the U.S. and signs of global manufacturing growth buoyed sentiment. Chinese shares may climb another 20 percent, following a 19 percent surge in the Hang Seng China Enterprises Index since March 20, said Mark Mobius, executive chairman of Templeton Emerging Markets Group. The U.S. and Canada will opposeWorld Bank projects related to Russia, to intensify pressure on the country over its actions in Ukraine.
“While valuations aren’t stretched, there will be limitations as to how far this rally can go,” Matthew Sherwood, head of investment markets research at Perpetual Ltd. in Sydney, which manages about $29 billion, said by phone. “Whenever a downward draft comes into the market, it’s likely to prove short-lived on the back of continued monetary support, valuations and an improving growth environment.”
Treasuries were little changed after falling a second day in New York, with yields down four basis points to 2.50 percent following data that showed jobless claims fell to the lowest level in more than eight years. Investors are assessing economic data for clues to the outlook for interest rates, with U.S. borrowing costs currently near zero.
The U.S. will vote against loans and investments that come before the World Bank’s board and are related to Russia, the world’s largest energy exporter, Treasury Department spokeswoman Holly Shulman said. Melissa Lantsman, a spokeswoman for Canadian Finance Minister Joe Oliver, said her country also opposes such projects. European governments are discussing doing the same, a European official said, asking not to be named because the discussions are confidential.
IMF Outlook
About 77 percent of S&P 500 members that have posted results this season have beaten analysts’ estimates for profit, while 66 percent exceeded sales projections, according to data compiled by Bloomberg. Profits probably rose 6.2 percent in the second quarter, while sales gained 3.3 percent, estimates compiled by Bloomberg show.
The International Monetary Fund lowered its outlook for growth yesterday as expansion rates from China to the U.S. weaken and military conflicts from Ukraine to the Middle East raise the risk of a surge in oil prices.
The world economy will expand 3.4 percent in 2014, the IMF said, less than its 3.6 percent prediction in April and stronger than last year’s 3.2 percent. Next year, growth will be 4 percent compared with an April forecast for 3.9 percent, the fund said.
“Global growth could be weaker for longer, given the lack of robust momentum in advanced economies” even as interest rates stay low, the IMF said in an update to its World Economic Outlook report. “Monetary policy should thus remain accommodative in all major advanced economies.”
FTSE Outlook
Todays pivot is 6803 so likely to be initial resistance there this morning, and then we have support at 6774 again today. Below that the bottom of the 10 day Bianca channel is 6762, which might be worth a small long. Resistance wise, the bulls will need to break 6825 today, with 6837 and then 6860 as the next resistance. 6860 is fairly heavy resistance as that is the top of the daily channels. Will be worth short there if seen. 6837 is the top of the 30 minute channel and more likely to be hit today, if the bulls break the pivot. The trends are still up, though the S&P has failed to really push on since closing at its record highs.
I think he pivot will break this morning, for a run to the top of that channel before dropping back. But its Friday, so stay nimble!
First arrow nearly done; will it stall at 6835?
Thanks Nick still holding long from yesterday
good one mate 🙂
Nice one! Looks like its going to fail just short of the 6834…
Nick, reversed back from 30, didn’t pick my call @ 35 🙁
Nor mine 🙁
Currently favour 6850+ in the short term. FTSE regaining an even keel?
http://i1348.photobucket.com/albums/p736/jmca01/FTSE100DFB_zpse8dd5d7f.png
Thanks Jim. What your view on DOW?
You could say that the Dow is range bound Sam, but it’s looking secure within a strongly rising ϵ-channel from June 01 last. Growth has cooled a bit over the past few days and the index has slipped below the middle line of the channel — but I don’t see that as any reason to panic right now. The ending of QE and interest rate rises, or their threat, later in the year could change the outlook.
Hi guys. I think there is a retracement coming before the weekend.
Long @ 14
Also long in dow
Stop?
No stop for dow, will book it before data @ 13:30. FTSE 6799
Feel like going short on DOW
me too. Just waiting for the data..
dow long closed 20 pts.
FTSE closed in -4, doesn’t want to spoil today’s profit..
trying to short ? 😀
nooooo
marco, how are you doing?
Nick’s chart is nearly complete 🙂 Congrats
Cheers
should have shorted dow….
I too missed it 🙁
PMS, what is your view for S&P?
Long @ 16980
i am out 🙁 grrrrrrrrr bye all good weekend
long dow 16981
tight stop.
closed long at break even earlier.
I think this should recover, but couldn’t take risk on a Friday.
you are right senu.
This is one of those dumb days. Selling without any reason, than selling. Any comments why the sell, will be even dumbest.
Below 17k again. Is this start of selling?
FTSE going over pivot
Should have let my S&P short play out! Now long Dow. AAPL holding me up there!
anyone shorting FTSE ? dax 1.5% down
No, but we are not yet out of the woods. We need more days to see a reverse. That was a big drop in start of July, which damaged a lot of the daily moving averages.
We need a bit more confidence from the bulls, next week, if this daily MA are to reverse
Working off Dow daily and 4 hour as should bounce and head back up to 17125 from here at 16940 ish. Long at 16938 at the moment. Cought a few late pips down from 16981 to 16940.
I’m long at 16958 quite heavily!
I’m heavily concern about hawkish FOMC statment next Wednesday.
Now that FTSE reached a crossroad….
What you been given a heads up its hawkish….
What ?
See your point read that wrong pms
sorry Marco, but I still cannot understand what you are saying. Can you explain more detail ?
I am assuming you are concerned that as at crossroads if fomc statement this week is hawkish big downside coming
My personnel view is alot of resistance above FTSE Dow but that eventually we will break through up.
Ok now understood. You are right in my concern.
For now…China is helping FTSE and maybe also some cracks in Putin’s power start to emerge, could help markets today and tomorrow.
Fx are starting to price in a somem rate hike. Usd is starting to climb
*sooner than expected
It seems China is more bullish in the 2nd half of each year, according to an HK analyst. This will help miners on FTSE