S&P 500, NIKKEI 225, HANG SENG INDEX OUTLOOK:S&P 500 index climbed 0.77% on Friday, boosted by beneficial tech earningsNi
S&P 500, NIKKEI 225, HANG SENG INDEX OUTLOOK:
- S&P 500 index climbed 0.77% on Friday, boosted by beneficial tech earnings
- Nikkei 225 index dangers breaking under 21,900 – a key help degree
- Grasp Seng index extends its consolidation, eyeing key help at 24,130
S&P 500 Index Outlook:
The S&P 500 index inventory benchmark ended the month of July with a 4% achieve – its finest month-to-month efficiency since April. Upbeat earnings from the foremost US know-how corporations – Apple, Amazon, Fb and Alphabet – boosted market sentiment, sending the know-how sector 2.37% increased on Friday. Now, traders and merchants are in all probability taking a look at in all probability what’s subsequent to help the rally of the US inventory benchmark after its astonishing 49% achieve from the trough seen in March.
Headwinds appears to be across the nook – score company Fitch has revised the credit score outlook of the US to destructive from steady, citing “the continuing deterioration in US public finance and the absence of a reputable fiscal consolidation plan”. This will likely serve to spice up demand for valuable metals because it highlights credit score danger in opposition to the backdrop of booming debt ranges.
Sector-wise, data know-how (+2.37%), client discretionary (+2.36%) and communication providers (+1.15%) have been doing the heavy lifting. Nevertheless, lower than half of the businesses ended increased in even these best-performing sectors. This means the rally was maybe lifted by a number of large corporations, whereas the overwhelming majority have in all probability run out of steam.
S&P 500 Sector efficiency 31-7-2020
Technically, the S&P 500 index has reached a minor resistance at 3,270 – the earlier excessive seen on 23rd July. Failing to interrupt this degree would in all probability lead to a pullback in the direction of help at 3,180– the 161.8% Fibonacci extension. The general development stays bullish as recommended by the 20-, 50- and 100-Day Easy Transferring Averages (SMAs). The 200% Fibonacci extension degree – at 3,358 – is a serious resistance forward.
S&P 500 Index – Every day Chart
Nikkei 225 Outlook:
Japan’s Nikkei 225 index inventory benchmark fell sharply on Friday as greater than 400 new Covid-19 instances have been reported in Tokyo. Virus considerations are undermining market sentiment, and are prone to stay the theme within the close to time period.
Technically, Nikkei 225 has fallen to a key help degree at 21,900 after two months of consolidation. Breaking under this degree would in all probability open room for extra draw back in the direction of its 100-Day SMA at 21,400, after which a key Fibonacci help at 20,700.
Nikkei 225 Index – Every day Chart
Grasp Seng Index Outlook:
Hong Kong’s Grasp Seng Index inventory benchmark (HSI) prolonged its consolidation final week, testing its 100-Day SMA at 24,400. The index was adversely harm by rising Covid-19 infections, a deep financial contraction and rising US-China tensions. This rendered Grasp Seng one of many worst performing inventory benchmark throughout the Asia-Pacific area. The outlook stays cloudy as there appears to be no fast answer to the above-mentioned matters.
In Shanghai, the inventory markets have probably stabilized after a deep correction in July. Excellent stability on Chinese language margin buying and selling has climbed to its highest degree seen in additional than a yr (chart under), suggesting that traders are nonetheless in a ‘danger on’ temper. The margin buying and selling stability has proven robust constructive correlation with the Shanghai Composite.
Supply: Bloomberg, DailyFX
Technically, Grasp Seng is discovering help at 24,400, breaking which can in all probability open room to extra draw back in the direction of the 61.8% Fibonacci retracement at 24,130. The general development stays bearish within the close to time period.
Grasp Seng Index – Every day Chart
Beneficial by Margaret Yang
Don’t give into despair, make a recreation plan
— Written by Margaret Yang, Strategist for DailyFX.com
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