The U.S. market is in a Confirmed Uptrend. The S&P 500 and Nasdaq held support along their respective 50- and 100-DMA this week. Despite a strong rally before the close Friday, the Nasdaq still faces multiple layers of resistance including the 50-DMA at ~13,400 before price resistance at ~13,600. The distribution day count remains elevated at six and seven, respectively, however, two expire on each next week due to time.
Author: Saminathan Jaganathan
European Focus
On Thursday, the Stoxx 600 closed 0.06% below last Friday’s close. Of the 17 indices that we cover, nine are in a Confirmed Uptrend and the remaining are in an Uptrend Under Pressure. This week, we upgraded Switzerland to a Confirmed Uptrend as it reached a new high, while Spain, Norway, Belgium, and Austria were downgraded to an Uptrend Under Pressure after they breached their respective 21-DMA.
Global Focus Developed
Australia’s ASX All Ordinaries Index gained 1.5%. The index reclaimed its 50-DMA and is trading close to its 52-week high. It is in a Confirmed Uptrend with seven distribution days. One distribution day will expire next week.
Global Focus Emerging
The CSI 300 rose 0.62% on lower volume on a weekly basis after a sharp fall for six consecutive weeks. The market was shifted to a Downtrend Thursday as the index fell below March 9’s previous low of 4,917. The index trended downward for three sessions but rebounded strongly Friday, with resistance at its 21-DMA (~5,130, +1.8%) and the next level of support at the 200-DMA (~4,880, -3.1%).
Global Focus Frontier
SN Nuclearelectrica (SNN) is the world’s largest state-owned nuclear power generation company in the unregulated market (by market cap) and sixth largest (by market cap) in the total nuclear market. Improving levels of achievement in annual investment programs and leadership in nuclear space are expected to drive growth.
China A Shares
The CSI 300 fell 2.71% on lower volume and remains in a Rally Attempt. The index was rangebound throughout the week and challenging resistance at the 100-DMA (~5,170, +3.3%), with next support at the 200-DMA (4,850, -3.1%). Economic data for the first two months of the year indicated strong growth. Retail sales and value-added industrial profit were higher than expectations. Property investment and property sales area grew 38.3% and 105%, respectively, from January to February. Fix-asset investment was slightly lower than the consensus but grew 3.5% y/y over the same period in 2019. The U.S. 10-year Treasury yield hit one-year new high of 1.7% on Thursday despite the U.S. Federal Reserve’s policy of not raising interest rates until 2023. U.S.- China bilateral talks were held March 18–19. Selling pressure on large-cap leading stocks in sectors such as Consumer Staple and Health Care was relieved. Consumer Cyclical led the market this week on the recovery of tourism and consumption of furniture. Utility followed the gains due to carbon neutrality. Financial, Technology, and Energy lagged. We expect the index to trade around ~5,000 in the near future. We advise investors to stay cautious in the volatile market and focus on stocks with solid fundamental and technical profiles.
US Focus
The U.S. market is in a Confirmed Uptrend. The S&P 500 pulled back to 21-DMA support after reaching an all-time high earlier in the week. The Nasdaq closed back below its 50-DMA after finding strong resistance at ~13,600. Support is now ~13,000, before the rising 100-DMA. The distribution day count stands at six a piece, with one expiring on each next week.
European Focus
On Thursday, the Stoxx 600 ended 0.83% above last Friday’s close. Of the 17 indices that we cover, 12 are in a Confirmed Uptrend and five in an Uptrend Under Pressure. This week, we shifted Luxembourg and Belgium to a Confirmed Uptrend after they reached a new high.
Global Focus Developed
Australia’s ASX All Ordinaries Index declined 0.8% this week. It closed below its 50-DMA and is trading 4% below its 52-week high. It is in a Confirmed Uptrend with eight distribution days. One distribution day will expire next week.
Global Focus Emerging
The CSI 300 fell 2.71% on lower volume and remains in a Rally Attempt. The index was range-bound throughout the week and challenging resistance at the 100-DMA (~5,170, +3.3%), with next support at the 200-DMA (4,850, -3.1%).
