Dow Jones Extends Increased as Volatility Falls. Nikkei 225, ASX 200 Could Rise

DOW JONES, NIKKEI 225, ASX 200 INDEX OUTLOOK:

• Dow Jones, S&P 500 and Nasdaq 100 closed +0.53%, +0.65%, and +1.12% respectively
• 10-12 months Treasury yield retreated barely to 1.609% from an intraday excessive of 1.646%
• The Nikkei 225 and ASX 200 indexes could transfer increased. US retail gross sales determine in focus

Reflation, Volatility, Yields, Vaccine, Asia-Pacific at Open:

Wall Road equities closed broadly increased on Monday as reopening hopes boosted sentiment, sending the Dow Jones and S&P 500 indexes to their report highs. Features amongst S&P 500 sectors had been led by defensive-oriented utilities (+1.36%), actual property (+1.18%) and client discretionary (+1.17%), whereas vitality (-1.25%) fell alongside crude oil costs.

The VIX volatility index prolonged declines to a multi-month low of 20.0, suggesting that the inventory market has most likely returned to a standing of complacency. This renders equities inclined to a sudden surge in volatility ought to this Wednesday’s FOMC assembly ship surprises. Individually, information crossed the wires that Germany jointed Italy, France and different nations in halting the usage of the AstraZeneca Covid-19 vaccine due to security considerations. This will likely additional delay the Eurozone’s vaccine progress.

VIX – Volatility Index

Chart by TradingView

The 10-year Treasury yield pared some features whereas the US Greenback index (DXY) climbed for a second day after Treasury Secretary Janet Yellen stated in a TV interview that “US inflation dangers stays small and manageable”. This echoed Fed Chair Jerome Powell’s newest feedback arguing that the present set of financial stimulus measures is “applicable”, hinting that the Fed could maintain its coverage charge and bond-purchasing program largely unchanged on the upcoming FOMC assembly. A brighter financial outlook alongside accommodative financial and monetary coverage could underpin a inventory market rally within the medium to long run.

Asia-Pacific markets look set to open stronger on Tuesday following a good US lead. Futures throughout Japan, Australia, Hong Kong, Taiwan and Malaysia are pointing to commerce mildly increased. Australia’s ASX 200 index opened up by 0.27%, led by actual property (+1.02%), client discretionary (+01.03%) and data expertise (+0.85%) sectors, whereas vitality (-0.66%) lagged behind. Japan’s Nikkei 225 index opened modestly increased as traders awaited a speech from BoJ Governor Haruhiko Kuroda.

Wanting forward, the Eurozone and German ZEW financial sentiment knowledge headline the financial docket alongside US retail gross sales and industrial manufacturing figures. Discover out extra from DailyFX calendar.

Wanting again to Monday’s shut, 5 out of 9 Dow Jones sectors ended increased, with 63.3% of the index’s constituents closing within the inexperienced. Shopper discretionary (+2.88%), healthcare (+0.72%) and client staples (+0.61%) had been among the many finest performers, whereas supplies (-2.24%) and vitality (-1.17) lagged behind.

Dow Jones Sector Efficiency 15-03-2021

Supply: Bloomberg, DailyFX

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Dow Jones Index Technical Evaluation

The Dow Jones indexbroke above the ceiling of the “Ascending Channel”, underscoring robust upward momentum. The index is trying to check a direct resistance stage at 32,863 (the 100% Fibonacci extension. A profitable try would most likely intensify near-term shopping for stress and produce the 127.2% Fibonacci extension stage (33,954) into focus. The general pattern stays bullish-biased as urged by the upward-sloped shifting averages and the MACD indicator.

Dow Jones Index – Each day Chart

Nikkei 225 Index Technical Evaluation:

The Nikkei 225 index breach above the 20-Day SMA line with renewed upward momentum. A right away help stage could be discovered at round 29,380 – the 127.2% Fibonacci extension stage. The MACD indicator is about to type a bullish crossover, suggesting that near-term momentum has turned upwards.

Nikkei 225 Index – Each day Chart

Chart by TradingView

ASX 200 Index Technical Evaluation:

The ASX 200 index stays in an “Ascending Channel” however upward momentum seems to be fading as urged by the downward-sloped MACD indicator. The general pattern stays bullish as urged by upward-sloped 50-day SMA line, however a minor correction appears to be underway. Holding above 6,730 – the 161.8% Fibonacci extension stage – could pave the best way for additional upside potential in direction of 6,935 – the 200% Fibonacci extension.

ASX 200 Index – Each day Chart

— Written by Margaret Yang, Strategist for DailyFX.com

To contact Margaret, use the Feedback part under or @margaretyjy on Twitter