The U.S. market remains in a Confirmed Uptrend. Yesterday, the S&P 500 closed 60bps lower on higher d/d volume and registered a
distribution day, while the Nasdaq declined ~110bps on lower d/d volume. The S&P 500 is testing support at its 21-DMA (5,239), while the
Nasdaq is testing support at its 10-DMA (16,772). The distribution day count stands at three on each index.
Author: Deepashree MC
Won Europe Today
Yesterday,
- European markets continued to trade choppily, with all the 16 indices we track closing in the red. The Stoxx 600
declined more than 1% on good volume, breaching its 21-DMA intraday.However, the index remains in a Confirmed
Uptrend, with near-term support at its 50-DMA (511.3; -0.4%).We recommend that investors follow a selective
approach. Add positions in names that are coming out of proper bases in leading industry groups post earnings. - All sectors lagged and closed in negative territory. Mining (-228bps), Travel and Leisure (-210bps), and Utility
(-174bps) were the weakest performers. - Among major indices, France’s CAC 40 gapped down and closed 1.5% lower on above average volume, near its
May 3 lows (7,921). Next level of support is at its 100-DMA (7,906.3; -0.3%). Germany’s DAX 30 declined 107bps,
recording its third distribution day. It breached its 21-DMA on decent volume. Next support is at its 50-DMA (18,292;
-1.02%). The U.K.’s FTSE 100 continued to decline, with support at its 50-DMA (8,089; -1.16%). - Spain and Belgium marked their seventh distribution day. Germany, Finland, Sweden, Switzerland, Austria, Italy,
and the Netherlands also recorded a distribution day each. - Ireland was shifted to a Downtrend and Italy was shifted to an Uptrend Under Pressure as both indices breached
their 50-DMA. Sweden, Austria, Portugal, and Spain were shifted to an Uptrend Under Pressure as the indices
breached their respective 21-DMA. - Seven markets are in a Confirmed Uptrend, seven in an Uptrend Under Pressure, one (Ireland) in a Downtrend, and
one (France) in a Rally Attempt. The average distribution day count stood at 3.57. - Actionable names in the Focus List include Beiersdorf (BEIX.DE; BEI:GR), Nkt (NKT.DK; NKT:DC), Safran
(SGM.FR; SAF:FP), and Rolls Royce (RR.GB; RR/:LN).
Won Global View
The U.S. market remains in a Confirmed Uptrend. Yesterday, the S&P 500 closed 75bps lower, while the Nasdaq declined ~60bps on
higher d/d volume and registered a distribution day. The S&P 500 has support at its 21-DMA (5,239), while the Nasdaq has immediate
support at its 10-DMA (16,780). The distribution day count stands at two and three, respectively, on each index.
Won Europe Today
We released our European Weekly Summary. Click here to access the report. Key points from it include:
- European markets paused last week, after climbing to an all-time high. The Stoxx 600 and other major indices are
exhibiting stalling action, with immediate support at their respective short-term moving averages. - Capital Equipment, Technology, and Retail led the gains, while Energy, Consumer Cyclical, Consumer Staple, and
Utility lagged the most. On our rotation graph, sectoral performance is broadly negative, with most sectors showing
deterioration in short-term momentum.
Won Global View
The U.S. market remains in a Confirmed Uptrend. Yesterday, the S&P 500 closed flat, while the Nasdaq rose ~60bps. Both indices
remain at or near all-time highs with the 10-DMA (5,281/16,749) as the first level of support. The distribution day count stands at two on
each index.
European Weekly Summary
Key points from this week’s report:
Please refer to the attached PDF for the full report.
- European markets paused last week, after climbing to an all-time high. The Stoxx 600 and other major indices are exhibiting stalling action with immediate support at their respective short-term moving averages. Expect consolidation at the current level or a pullback to their 10-/21-DMA. All sectors, except Basic Material, exhibited negative short-term momentum.
- We remain constructive on the overall market and recommend investors add risks in stocks that are part of leading industry groups and are breaking out of proper bases/retaking key moving averages with a strong and rising RS line. Reduce risks in stocks that are breaching key support levels.
- Sectors closed mixed last week. Capital Equipment, Technology, and Retail led the gains, while Energy, Consumer Cyclical, Consumer Staple, and Utility lagged the most. On our rotation graph, sectoral performance is broadly negative with most sectors showing deterioration in short-term momentum. Basic Material was an outlier, with positive short-term momentum. Financial, Health Care, and Transportation, which recently entered the best quadrant, are showing early signs of weakness. Capital Equipment, though still in the best quadrant, continues to show deteriorating short-term momentum. Technology and Consumer Cyclical are showing further deterioration with weakening momentum on the charts.
- Sector Score Cards – Stocks of Interest (Top-rated names with best technical setups – refer pages 9–20):
- European Focus List Update:
- Actionable names include Beiersdorf (Xet) (BEIX.DE), Nemetschek (Xet) (NEMX.DE), Novo Nordisk ‘B’ (NON.DK), Relx (REL.GB), Rolls-Royce (RR.GB), Saab B (SAAB.SE), Safran (SGM.FR), Swissquote ‘R’ (SQN.CH).
- Addition: None
- Removal: Hermes International (RMS.FR); Moncler (MONC.IT); Recordati Indua.Chimica (REC.IT)
Won Global View
The U.S. market remains in a Confirmed Uptrend. The S&P 500 was flat last week, while the Nasdaq rallied ~1.4% higher, led by the technology sector. Both indices remain at or near all-time highs, with the 10-DMA (5,276/16,690) as the first level of support. The distribution day count stands at two on each index.
Won Europe Today
Yesterday,
- European markets had a positive session. The Stoxx 600 rose 32bps, closing in line with its 10-DMA (522.59). Resistance is at its 52-week high of 525.20. On the downside, support is at 21-DMA (517.2; 0.9% below) followed by its 50-DMA (511; 2.1% below). We recommend that investors follow a selective approach while adding positions in names coming out of proper bases, post earnings in leading industry groups.
- Among sectors, Utility (112bps) and Oil and Gas (102bps) gained the most, while Healthcare (-19bps) and Technology (-5bps) were the only laggards.
- Among major indices, France’s CAC 40 closed 46bps in the green, retaking its 21- and 50-DMA with near-term resistance at its 10-DMA (8,158.1; 0.3% above). Germany’s DAX gained 42bps closing above its 10-DMA (18,736). Resistance is at May 15 highs of 18,892.
- Out of 16 indices we track, 12 closed in the green. The U.K was closed on account of market holiday. 14 markets were in a Confirmed Uptrend while France is in a Rally Attempt and Ireland is in an Uptrend Under Pressure. The average distribution day count stood at 2.54.
- Actionable names in the Focus list include Beiersdorf (BEIX.DE; BEI:GR), Saab (SAAB.SE; SAABB:SS), Safran (SGM.FR; SAF:FP), Rolls Royce (RR.GB; RR/:LN), Bachem Holding (BANB.CH; BANB:SW), Universal Music group (UNMG.NL; UMG:NA), and Novo Nordisk ‘B’ (NON.DK; NOVOB:DC).
Won Europe Today
On Friday,
- European markets had a weak session. The Stoxx 600 was down 0.2%, breaching its 10-DMA (522.39). Next level of support at 21-DMA (515.8; 0.9% below) followed by its 50-DMA (510.3; 1.9% below). We recommend investors follow a selective approach, adding position in names coming out of proper bases, post earnings in leading industry groups.
- Among Sectors, Automobiles (65bps) and Financial services (26bps) were prominent gainers, while Utility (-1.3%) and Healthcare (-0.8%) lagged the most.
- Among major indices, France’s CAC 40 closed almost flat testing stiff resistance from its converging 21- and 50-DMA (8106). On the downside, support is available at its May 6 lows (7,961; -1.6%). Germany’s DAX continued testing resistance from its marginally declining 10-DMA, closing flat near its 21-DMA support. U.K.’s FTSE 100 continued to remain weak, closing 26bps in the red, with lows breaching its 21-DMA (8310.2). Support available at May 7 lows (8213; -1.2%).
- Out of 16 indices we track, fourteen closed in the red. Spain recorded its sixth distribution day. 14 markets were in a Confirmed Uptrend while France is in a Rally Attempt and Ireland is in an Uptrend Under pressure. The average distribution day count stood at 2.75.
- Actionable names in the Focus list include Beiersdorf (BEIX.DE; BEI:GR), Saab (SAAB.SE; SAABB:SS), Safran (SGM.FR; SAF:FP), Rolls Royce (RR.GB; RR/:LN), Bachem Holding (BANB.CH; BANB:SW), Universal Music group (UNMG.NL; UMG:NA), and Novo Nordisk ‘B’ (NON.DK; NOVOB:DC).
Won Europe Today
Ishares DJ Stoxx600 (EXSA.DE)
We released our Weekly Global Laggards Report today. 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. Stocks in Europe include Croda International (CRDA.GB; CRDA:LN), Hugo Boss (BOSSX.DE; BOSS:GR), and EasyJet (EZJ.GB; EZJ:LN).
