Good morning. Well Fridays prices did indeed dip from that area were we went short after all, and have dropped a bit further to 6630 as I write this, after Fridays close at 6650. It didn’t seem like it was going to at the time which is why I closed it early afternoon – the joys of Friday trading! If the Bianca channels hold today then the dip should hold around 6600 for the moment as we have the bottom of the 20 day at 6595 and 10 day at 6609. So the big question for this month will be , where and if the Santa Rally will appear? Today is the start of the new month so could be slightly bullish as new monthly funds come in.
On a more positive news note for the UK economy, the Office for Budget Responsibility (OBR) – the Government’s independent fiscal watchdog – is likely to upgrade its projection for UK growth in 2013 to 1.4pc, from a forecast of 0.6pc in March.
The Dax is still hovering around the 9400 level mentioned, and the S&P tried to go for that 1814 level I mentioned on Friday, nearly reaching it too, hitting 13.6 high Just the FTSE that lagged upwards once again but was quick to join in on the drops once they started.
Gold is still hovering around the 1245 area, though it looks like 1256 is the line in the sand that the bulls will need to break, opening up 1276, possibly 1286. If it holds as resistance then the drop to sub 1200 still looks viable as mentioned last week.
Asia Overnight from Bloomberg
Asian stocks swung between gains and losses as gauges China’s manufacturing growth beat analyst estimates and retail sales in the U.S. headed for the weakest holiday results since 2009.
The MSCI Asia Pacific Index was little changed at 142 as of 2:02 p.m. in Hong Kong, having swung between gains of 0.1 percent and losses of 0.4 percent. About five shares declined for every four that rose on the gauge. More than $8 trillion has been added to the value of global equities this year, the biggest increase since 2009, as central banks took steps to shore up economies worldwide.
“There’s always going to be doubts about whether the growth we’re seeing in the U.S. is going to be sustainable after the central bank starts to taper stimulus,” said Nader Naeimi, Sydney-based head of dynamic asset allocation at AMP Capital Investors Ltd., which manages $131 billion. “While the U.S. market is starting to look frothy, we continue to see value in markets like China and Japan.”
China’s manufacturing purchasing managers’ index, released yesterday, came in at 51.4 for November, matching the 18-month high reached in October and beating 24 of 26 estimates in a Bloomberg News survey. A separate report for HSBC Holdings Plc and Markit Economics today showed PMI was at 50.8 last month, compared with 50.9 in October.
U.S. Futures
Futures on the S&P 500 Index gained less than 0.1 percent today. The gauge lost 0.1 percent on Nov. 29 as investors sold shares in the final half hour of a shortened trading session, erasing earlier gains fueled by a rally in online retailers amid Black Friday sales.
U.S. brick-and-mortar retailers eked out a 2.3 percent sales gain on Thanksgiving and Black Friday, in line with a prediction for the weakest holiday results since 2009.
FTSE Outlook
Well Friday played out very well in the end, despite me closing that short a bit early we got the drop form the 6680 area as expected. Was one of those days where it was slow to rise but quick to drop following the USA. There is a bit of initial support at this 6640 area, where Fridays final down arrow terminated, and based on the ProRealTime lines we have a daily support there, and I expect an initial rise to 6670. That’s a fairly key resistance level as its also around the top of the 10 day Bianca channel, and also tallies with my Dax thoughts above for a rise then dip from 9420ish.
I’ll keep it fairly conservative for the moment with the arrows on the chart below so I can get this email sent out to you as its just past half 7. Will email round further analysis later.