Author: Gaghan

WON Europe Today

Posted on by Gaghan

Key points from it include:

  • The Stoxx 600 is in a Confirmed Uptrend with five distribution days. It is still trading in its upward channel that started in November 2020, with strong support at its rising 50-DMA. Of the 17 indices we cover, 12 are in a Confirmed Uptrend and five in an Uptrend Under Pressure.

  • Last week, we shifted Germany, Switzerland, and Norway to a Confirmed Uptrend. The average distribution day count in the region came down to 4.81 compared to 5.13 last week.

  • Focus List Update: We added Barco New ( BAR.BE; BAR:BB ), Cellnex Telecom ( CLNX.ES; CLNX:SM) , and Beneteau ( CHBE.FR; BEN:FP ) to our European Focus List.

  • Other actionable names in the Focus List include Fevertree Drinks ( FEVR.GB; FEVR:LN ), Dechra Pharmaceuticals ( DPH.GB; DPH:LN ), Eurofins Scientific ( EUF.FR; ERF:FP ), Interpump Group ( IP.IT; IP:IM ), Intesa Sanpaolo ( ISP.IT; ISP:IM ), B&M European Value Retail ( BME.GB; BME:LN ), Novo Nordisk ( NON.DK; NOVOB:DC ), Carl Zeiss Meditec ( AFXX.DE; AFX.DR ), and Moncler ( MONC.IT; MONC:IM ).

Won Global View

Posted on by Gaghan

The U.S. market remains in an Uptrend Under Pressure. The S&P 500 and Nasdaq traded relatively flat for a fifth straight session, still finding resistance just below all-time highs. Near-term support remains the 21-DMA on the S&P 500 and the 50-DMA on the Nasdaq. The distribution day count stands at eight and three, respectively, with one day expiring on the S&P 500 Friday.

Energy outperformed all sectors by a wide margin, jumping ~3% yesterday and back into year-to-date highs. Basic Material followed with gains of over 1% which also sent the sector back to new highs. All other sectors traded relatively flat except Health Care, which fell over 1% on the back of a downward guidance revision from ABT. Eight of the best 15 performing industry groups yesterday came from Oil & Gas which dominate the top-ranked groups. The best performing industry groups over the past week include Coal, Oil & Gas, Metals, Steel, Alternative Energy, Auto OEM, Mobile Homes, and Specialty Retail. The worst performing groups include Generic Drugs, Drug Stores, Medical Services, Network Solutions, Utilities, and Cleaning Products

Won Europe Today

Posted on by Gaghan

Yesterday,

  • European markets had a bearish start to the week as the majority of markets closed in the red as investors reacted
    to inflation data from the region. The U.S. and the U.K. markets were closed. Given the volatility in the market, we
    recommend that investors book profits in extended names and remain open to adding risk in strong names coming
    out of proper bases.
  • The Stoxx 600 was down 0.49% on lower volume and remains in a Confirmed Uptrend.
    Major indices like Germany’s DAX and France’s CAC closed in the red after making new highs last week, both the
    indices have support at its 10-DMA. The U.K.’s FTSE 100 was closed.
  • Of the 17 indices we track, all closed in the red except Luxembourg and Italy. Twelve indices are now in a
    Confirmed Uptrend and five in an Uptrend Under Pressure. The average distribution day count stands at 4.68.
    Actionable names in the Focus List include Barco New ( BAR.BE; BAR:BB ), Fevertree Drinks ( FEVR.GB;
    FEVR:LN ), Dechra Pharmaceuticals ( DPH.GB; DPH:LN ), Eurofins Scientific ( EUF.FR; ERF:FP ), Interpump Group
    ( IP.IT; IP:IM ), Intesa Sanpaolo ( ISP.IT; ISP:IM ), Novo Nordisk ( NON.DK; NOVOB:DC ), Carl Zeiss Meditec ( AFXX.DE;
    AFX:GR ), Cellnex Telecom ( CLNX.ES; CLNX:SM ), Trigano ( TRI.FR; TRI:FP ), and Beneteau ( CHBE.FR;
    BEN:FP ), Moncler ( MONC.IT; MONC:IM ), B&M European Value Retail ( BME.GB; BME:LN ).

Won Global View

Posted on by Gaghan

The U.S. market remains in an Uptrend Under Pressure. The S&P 500 and Nasdaq have regained their 21-DMA
( 4,168 ) and 50-DMA ( 13,612 ), respectively, and continue to consolidate in a constructive fashion above support. The
distribution day count stands at eight and four, respectively, with one day expiring on each index this week.

Consumer Cyclical ( +4.3% ) significantly outperformed last week due to strength in low-ranked auto-related groups.
Technology and Transportation jumped 2% due to improvement in semiconductors and travel related stocks,
respectively. Four other sectors – Basic Material, Financial, Capital Equipment, and Retail – rose ~1%. The best
performing industry groups over the last five sessions include Semiconductor, Coal, Food – Dairy Products, Mining,
Beverage-Non-Alcoholic, Leisure – Gaming, Aerospace, Internet – Content, and Homebuilders. The worst performing
groups include Solar/Alt Energy, Advertising, Biotech, Medical – Generic Drugs, Auto Manufacturers, Consumer
Education, Medical-Services. 77% of S&P 500 stocks are trading above their respective 50-DMA and 92% are trading
above their respective 200-DMA, compared with 70% and 91%, respectively, last week. Among the Nasdaq 100, 73%
of stocks are trading above their respective 50-DMA, compared with 62% last week.

U.S. Economic Summary

Posted on by Gaghan

Q1 GDP expanded 6.4% :
The U.S. economy grew 6.4% in Q1, according to the second estimates, same as the advance estimate and 10bps
below consensus. The expansion for the quarter reflected positive contributions from personal consumption
expenditures (PCE), nonresidential fixed investment, federal government spending, residential fixed investment, and state and local government spending.
• Personal spending increased 0.5%, matches consensus:
Personal spending increased 0.5% m/m in April. The increase was mainly due to higher spending on services, dining out, and traveling as the economy reopened further amid vaccine rollout. Within goods, a decrease in nondurable goods was partly offset by an increase in durable goods. Within nondurable goods, the decrease was led by food and
beverages. Within durable goods, the increase reflected an increase in motor vehicles and parts. Within services, the
largest contributors to the increase were spending on recreation services, food services, and accommodations.
• The 10-year bond yield remained in a tight range in May:
The 10-year yield lost 3bps in May and closed at 1.62%. The yield declined more than 10bps during the first two weeks of June.
• Unemployment rate declines, NFP below expectations:
The unemployment rate declined 30bps m/m to 5.8% in May, down from 14.8% in April 2020, but still up from 3.5% in February 2020. The number of unemployed persons on a temporary layoff declined 291K to 1.8M, while the number of permanent job losers declined 295K to 3.2M. However, they both are 1.1M and 1.9M higher than February 2020. Non-farm payrolls increased 559K (versus consensus of 650K gain). Employment increased in leisure and hospitality (+292K) and public and private education.

Won Europe Today

Posted on by Gaghan

On Friday,

  • European markets closed in the green as major markets hit record highs amid continued optimism over global
    economic recovery led by positive economic data from the U.S. We recommend that investors book profits in
    extended names and remain open to adding risk in names coming out of proper bases.
  • The Stoxx 600 gained 0.57% and made a new high but on lower volume. It remains in a Confirmed Uptrend with five
    distribution days. Financial Services (+1.3%) led the gains as most sectors closed in the green.
  • Major indices like Germany’s DAX, France’s CAC, and the U.K.’s FTSE 100 closed in the green, but on lower
    volume. Germany’s DAX and France’s CAC are trading at all-time highs and are in Confirmed Uptrend. The U.K.’s
    FTSE 100 is also trading above its key moving averages and is in a Confirmed Uptrend with five distribution days.
    Of the 17 indices we track, all closed in the green except Ireland and Portugal. We shifted Germany and Norway to
    a Confirmed Uptrend after the indices reclaimed their prior highs. Twelve indices are in a Confirmed Uptrend and
    five are in an Uptrend Under Pressure. The average distribution day count stands at 4.81.
  • Actionable names in the Focus List include Fevertree Drinks ( FEVR.GB; FEVR:LN ), Dechra Pharmaceuticals
    ( DPH.GB; DPH:LN ), Eurofins Scientific ( EUF.FR; ERF:FP ), Interpump Group ( IP.IT; IP:IM ), Intesa Sanpaolo ( ISP.IT;
    ISP:IM ), B&M European Value Retail ( BME.GB; BME:LN ), Novo Nordisk ( NON.DK; NOVOB:DC ), Carl Zeiss Meditec
    ( AFXX.DE; AFX:GR ), Cellnex Telecom ( CLNX.ES; CLNX:SM ), Moncler ( MONC.IT; MONC:IM ), and Beneteau
    ( CHBE.FR; BEN:FP ), Barco New ( BAR.BE; BAR;BB ).

Won Global View

Posted on by Gaghan

The U.S. market remains in an Uptrend Under Pressure. The S&P 500 is consolidating above support at its 21-DMA (4,168). The Nasdaq is also digesting recent gains and consolidating above price support along ~13,620 and its 50-DMA (13,600). The distribution day count remains at eight and four, respectively, with one day expiring on each index next week.

Three sectors – Basic Material, Consumer Cyclical, and Capital Equipment – were up ~1%, while all others were relatively flat or nchanged. Nine of 11 sectors are above their 50-DMA, while Consumer Cyclical and Utility are testing their respective moving averages. The best performing industry groups over the last five sessions include Consumer Electronics, Non-Alcoholic Beverages, Auto Manufacturers, Advertising, Solar/Alt Energy, Casinos/Gaming Equipment, Software, Semis, Internet Content, Medical Services, and Apparel. The worst performing groups include Drug Stores, Department Stores, Generic Drugs, Wholesale Auto Parts, Machinery, Steel, Ships, and Life Insurance. We continue to recommend a selective approach in deploying capital given the Uptrend Under Pressure status and elevated distribution day count. However, we have noticed a slight improvement across stocks as the S&P 500 has held its 21-DMA and the Nasdaq regained its 50-DMA. Focus on quality ideas emerging out of sound bases with relative strength line at or near new highs while reducing exposure to stocks breaking below key support levels.

Won Europe Today

Posted on by Gaghan
  • European markets continued their stalling action as indices pared their initial gains. Volume was quite large across
    all the major indices. Inflation remains the key theme driving market sentiment. We recommend that investors book
    profits in extended names and remain open to adding risk in names coming out of proper bases.
  • The Stoxx 600 gave up its initial gains to close near the bottom of the bar, forming a downside reversal on high
    volume. Price movement continues to suggest market action might be choppy in the upcoming weeks. Among
    sectors, Basic Resources led the gains, while Health Care stocks lost more than 1%.
  • Among the other major indices, France’s CAC bounced off its 10-DMA while Germany’s DAX recorded its sixth
    distribution day, finding support at its 10-DMA. The U.K.’s FTSE 100 is testing support at its 21-DMA.
    Among the 17 indices we track in Europe, Germany, the U.K., Denmark, Switzerland, Spain, Belgium, and the
    Netherlands closed in negative territory. Germany, Denmark, and the Netherlands recorded distribution days

Won Europe Today

Posted on by Gaghan

Yesterday,

  • European markets closed flat again. Stalling action coupled with the higher distribution day count indicates choppy
    market action over the next few sessions. We recommend that investors book profits in extended names. However,
    we are open to adding risk in names coming out of proper bases.
  • The Stoxx 600 closed flat. It is still trading above its 10-DMA and in a Confirmed Uptrend. Among sectors, Travel &
    Leisure stocks led the bulls, while Banks dropped more than 1%.
    Among other major indices, France’s CAC, Germany’s DAX, and the U.K.’s FTSE 100 are all testing support at
    their respective 10-DMA.
  • Among the 17 indices we track in Europe, France, Ireland, Switzerland, Portugal, and Luxembourg closed in
    positive territory. Finland, Sweden, and Italy recorded distribution days.
  • New Focus List addition Beneteau ( CHBE.FR; BEN:FP ) is actionable. Other actionable names in the list include
    Fevertree Drinks ( FEVR.GB; FEVR:LN ), Dechra Pharmaceuticals ( DPH.GB; DPH:LN ), Eurofins Sciencific
    ( EUF.FR; ERF:FP ), Interpump Group ( IP.IT; IP:IM ), Intesa Sanpaolo ( ISP.IT;
    ISP:IM ), B&M European Value Retail ( BME.GB; BME:LN ), Novo Nordisk ( NON.DK;
    NOVOB:DC ), Carl Zeiss Meditec ( AFXX.DE; AFX:GR ), Cellnex Telecom ( CLNX.ES;CLNX: SM ), and Moncler
    ( MONC.IT;MONC:IM ).

Won Global View

Posted on by Gaghan

The U.S. market remains in an Uptrend Under Pressure. The S&P 500 again rose slightly to hold the recent retake of its 21-DMA ( 4,158 ). The Nasdaq outperformed, up 0.6%, building on a retake of both 21- and 50-DMA and the 13,620 level. It is back within 3% of highs. Indices lost a distribution day each at yesterday’s close. The S&P 500 count is still elevated at eight, while the Nasdaq has just four. Nine of 11 sectors rose, led by Consumer Cyclical (+1.6%), Energy (+1.3%), and Transportation (+1.0%). Health Care and Consumer Staple closed flat to slightly lower. The best performing industry groups over the last five sessions include Consumer Electronics, NonAlcoholic Beverages, Auto Manufacturers, Advertising, Solar/Alt Energy, Casinos/Gaming Equipment, Software, Semis, Internet Content, Medical Services, and Apparel. The worst performing groups include Drug Stores, Department Stores, Generic Drugs, Wholesale Auto Parts, Machinery, Steel, Ships, and Life Insurance.