Author: Sandeeep N

China A Shares

Posted on by Sandeeep N

The CSI 300 rose 2.36% on higher volume and remains in an Uptrend Under Pressure with the number of distribution days decreasing to four. The index faces resistance at July’s high of ~4,900 (+2.3%) and has support at its 50-DMA (~4,714, -1.6%). It closed with good gains in the first two sessions of the week, boosted by data showing signs of economic recovery and tourism rebound during the holiday. September macro data were mostly encouraging. Exports grew 9.9% y/y, while imports surged 13.2% y/y, both higher than estimates and August’s figures. M2 rose 10.9% y/y, also beating consensus. Total social financing increment was RMB 3.48T, slightly lower than August, but RMB financing increment was much higher than consensus, indicating improving production. However, shares trended downward from Wednesday to Friday as both PPI and CPI turned lower and investors adopted a wait-and-see attitude before the U.S. elections and Q3 earnings. Q3 GDP will be released next Monday. We expect the index to remain range-bound before it breaks above key resistance at 4,900. We recommend investors be patient and focus on quality ideas setting up new bases.

US Focus

Posted on by Sandeeep N

The U.S. market remains in a Confirmed Uptrend. Indices are consolidating strong gains off their respective 50-DMAs in prior weeks. Support is at the rising 10-DMA(S&P 500: 3,459, Nasdaq: 11,580). Distribution day count is seven and four on the S&P 500 and Nasdaq, respectively, with two days expiring on each index next week.

European Focus

Posted on by Sandeeep N

On Thursday, the Stoxx 600 ended 2.01% below last Friday’s close. Of the 17 indices that we cover, nine are in a Confirmed Uptrend, four are in an Uptrend Under Pressure, three are in a Rally Attempt, and one in a Downtrend.

Global Focus Emerging

Posted on by Sandeeep N

The CSI 300 rose 2.36% on higher volume and remains in an Uptrend Under Pressure with the number of distribution days decreasing to four. The index faces resistance at July’s high of ~4,900 (+2.3%) and has support at its 50-DMA (~4,714, -1.6%).

China A Shares

Posted on by Sandeeep N

The CSI 300 gapped up and gained 2.0% in this one-day week after the holiday. Volume was higher but still below average. The market remains in an Uptrend Under Pressure with five distribution days. The index tested resistance at the 50-DMA (4,691), while immediate support still lies at its rising 100-DMA (4,449). The Caixin Services PMI stayed in expansion for the fifth straight month in September thanks to China’s successful control of COVID-19. Strong recovery of tourism and consumption in the Golden Week holiday also boosted market sentiment. Photovoltaic glass producers saw strong gains due to recent price hikes; ideas include Zhuzhou Kibing Group (ZKG.CN, 601636.CH, +5.3%) and Sinoma Sci & Tech (STC.CN, 002080.CH, +8.4%). The index is expected to stay range-bound before it breaks above key resistance at July’s high of 4,900 (+6.7%). We maintain a cautious view of the general market with consistently low daily turnover and an elevated number of distribution days. We expect the CSI to continue consolidating. Investors are advised to stay patient and wait for quality ideas to set up new bases. Continue to focus on stocks with high relative strength.

US Focus

Posted on by Sandeeep N

The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq are building the right side of consolidation after breaking above short-term resistance (S&P 500: 3,430, Nasdaq: 11,400). Distribution day count remains elevated at seven and five, however, two days will expire on the S&P 500 and one on the Nasdaq next week.