We released our Weekly Global Laggards Report yesterday (please click here to access the report). The stocks
highlighted in this report are laggards relative to their own domestic markets. We recommend that they be underweighted
as they may be vulnerable to further downside risk and underperformance. European names highlighted this week include
BASF (BASX.DE; BAS:GR), Volvo B (VOBF.SE; VOLVB:SS), Flughafen Zurich (FHZN.CH; FHZN:SW), Aena Sme
(AENA.ES; AENA:SM), Royal Unibrew (RBR.DK; RBREW:DC), Christian Hansen Holding (CHR.DK; CHR:DC), Banco
Santander (SAN.ES; SAN:SM), Grafton Group (GFTU.GB; GN5:ID), and Kuehne Nagel International (KNIN.CH; KNIN:SW).
Author: admin
Won Global View
The U.S. market remains in an Uptrend Under Pressure. The S&P 500 and Nasdaq staged downside reversals, retracing much of Wednesday’s gains. Both indices remain within consolidation, with real trend yet to develop. Support remains at the 50-DMA on the S&P 500 and the 100-DMA on the Nasdaq. The distribution day count stands at five each, with one day expiring on the S&P 500 next week.
Won Europe Today
Yesterday,
- European markets ended higher after closing in the red for five consecutive trading days. European stocks inched
higher with investors anticipating the Federal Reserve’s decision to combat inflation risks by quickening the
withdrawal of its pandemic-related stimulus. As markets are expected to be volatile leading up to the Fed’s and
other major central banks’ policy decisions in the upcoming weeks, we continue to recommend that investors trim
any leveraged positions and let the markets stabilize before taking new positions. - The Stoxx 600 gained 0.3% on low volume while retaking its 100-DMA. The index will be monitored to see if it
retakes its 50- and 21-DMA after the monetary policy decisions of the Fed and the ECB are announced on
Thursday. Technology, Health Care, and Utility sectors supported the market, gaining 1.3%, 1.1%, and 0.9%,
respectively. The Oil and Travel & Leisure sectors dropped by 1.3% and 1.1%, respectively. - Among the other major indices, France’s CAC and Germany’s DAX gained 0.5% and 0.2%, respectively. The CAC
rebounded and is gaining after finding support at its 50-DMA while the DAX retook its 200-DMA and is expected to
find support there during the volatility in the upcoming weeks. Due to concerns about the spread of the Omicron
variant and the U.K’s latest inflation data (10-year high), the FTSE 100 dropped 0.7% on high volume, thus
recording a distribution day and breaching its 50-DMA, but finding support at its 100-DMA. - Among the 17 indices we track in Europe, nine made small or moderate gains, while eight closed in the red on
Wednesday. While there was no change in the market conditions of the 17 indices, with five continuing in a
Confirmed Uptrend, three in a Rally Attempt, and the remaining nine in an Uptrend Under Pressure, the
U.K. recorded a distribution day, taking the average distribution day count for European markets up to 3.8. - Actionable names in the Focus List include Dassault Systèmes (DSY.FR; DSY:FP), Schneider Electric (QT@F.FR;
SU:FP),Teleperformance (ROFR.FR; TEP:FP), and Yougov (YOU.GB; YOU:LN).
Won Global View
The U.S. market remains in an Uptrend Under Pressure. Indices recovered off intra-day lows and closed near session highs. The S&P 500 regained its 10- and 21-DMA (4,646) after holding support at its 50-DMA and is only 1% off its all-time high. The Nasdaq jumped 2% and regained its 50-DMA (15,422) after holding support at its 100-DMA and is 4% off its all-time high. The distribution day count stands at four and five on the S&P500 and Nasdaq, respectively.
O’Neil Capital Equipment Sector Weekly
D R Horton (DHI) – $38B market cap; $265M ADV: We added DR Horton to our U.S. Focus List as the stock is trading at a 52-week high after breaking out of a stage-two 27-week double-bottom base. DHI is the largest homebuilder in the U.S. and caters to entry-level buyers. The company has recorded strong demand in all operating regions and may benefit from this due to its affordable pricing and strong inventory management. Consensus expects sales and EPS CAGR of 15% each in the next two years.
Won Europe Today
Yesterday,
- European markets closed in the red for the fifth consecutive day. Although the markets opened with a positive
outlook, the surge in coronavirus cases, inflation across Europe and the U.S., and uncertainty about the monetary
policies of major central banks caused key European markets to close with sharp or moderate losses. We
continue to recommend that investors trim any leveraged positions and let the markets stabilize before taking new
positions. - The Stoxx 600 declined 0.8% on low volume, breaching its 100-DMA. The index will be monitored to check if the
100-DMA is retaken after the policy decisions undertaken by the ECB on Thursday, or if the index drops further
before finding support at the 200-DMA. Technology, Auto, and Health Care were among the most affected sectors,
dropping 2.4%, 1.5%, and 1.4%, respectively. Health Care was one of the few major sectors to register gains, rising
0.8%. - Among the other major indices, France’s CAC and Germany’s declined DAX 0.7% and 1.1%, respectively, on high
volume and thus recorded a distribution day each. The CAC continues to find support at its 50-DMA while the DAX
dropped to breach its 200-DMA. The U.K.’s FTSE 100 dropped 0.2% on low volume while continuing to find support
at its 50-DMA. - Among the 17 indices we track in Europe, 13 fell moderately or sharply, while Ireland, Italy, Spain, and Luxembourg
closed with a gain on Tuesday. While there was no change in the market conditions of the 17 indices, with five
continuing in a Confirmed Uptrend, three in a Rally Attempt, and the remaining nine in an Uptrend Under Pressure,
six of these indices recorded distribution days. Denmark, France, Germany, the Netherlands, Norway, and Portugal
recorded a distribution day each, taking the average distribution day count for European markets up to 3.7. - Actionable names in the Focus List include Dassault Systemes (DSY.FR; DSY:FP), Schneider Electric (QT@F.FR;
SU:FP),Tele performance (ROFR.FR; TEP:FP), and Yougov (YOU.GB; YOU:LN).
Won Global View
The U.S. market remains in an Uptrend Under Pressure. The S&P 500 gapped down yesterday before finding support just above its 50-DMA to close mid-range on the session. The Nasdaq also gapped down breaking its 50-DMA, before finding support at its 100-DMA, which is slightly above early December lows. Both indices continue to chop within consolidation. The distribution day count increased to five each, with one day expiring on the S&P 500 at the close today.
Won Europe Today
We released our European Weekly Summary yesterday. Click here to access the report.
Key points from it include:
- The Stoxx 600 regained some ground last week but remains in an Uptrend Under Pressure with four distribution
days. The index now trades 3% off highs and is just 0.5% above its immediate support at 50-DMA. Currently, we
remain cautious as we would like to see more market breadth. Continue to focus on high-quality, high-relativestrength ideas while avoiding or reducing risk in lagging ideas trading below logical support. - Consumer Staple led the market last week, while all other sectors managed to close in the green. Our rotation
chart shows short-term momentum (over four weeks) continuing to improve in Capital Equipment and turning
positive among Basic Material, Utility, and Consumer Staple. Transportation remains the weak spot of the market. - European Focus List Update: We did not add any names, but removed DSV (DSV.DK; DSV:DC) and Euronext
(ENX.FR; ENX:FP). The list currently consists of 43 stocks, over weighted toward Capital Equipment, Financials,
and Health Care.
Won Global View
The U.S. market remains in an Uptrend Under Pressure. The S&P 500 and Nasdaq pulled back on rising volume but continue to consolidate above support at their respective 21-DMA (S&P 500:4,642) and 50-DMA (Nasdaq:15,379). The distribution day count increased to four on each index with one day expiring on the S&P 500 after the close tomorrow
Coca-Cola Icecek
Coca-Cola Icecek is one of the key bottlers of Coca-Cola. It produces, distributes,
and sells carbonated soft drinks, water, juices, sports & energy drinks, and iced
teas. It operates in the Central Asian countries of Turkey, Pakistan, Kazakhstan,
Azerbaijan, Kyrgyzstan, Turkmenistan, Jordan, Iraq, and Tajikistan.
