Equity Analysis and News
- US Equity Markets Rebound
- Cyclicals vs Defensive Stocks
- FAANG Earnings May Extend Recovery
See our Q4 forecasts to learn what will drive price action through the quarter
| Price | 200DMA | RSI | IG Sentiment | |
|---|---|---|---|---|
| Europe | ||||
| FTSE 100 | 7141 | 7432 | 40 | Mixed |
| DAX | 11426 | 12444 | 35 | Mixed |
| CAC 40 | 5087 | 5359 | 30 | Mixed |
| FTSE MIB | 19092 | 21982 | 38 | - |
| US | ||||
| S&P 500 | 2682 | 2763 | 39 | Mixed |
| DJIA | 24874 | 25104 | 41 | Bullish |
| Nasdaq 100 | 6885 | 7131 | 39 | - |
| Asia | ||||
| Nikkei 225 | 21805 | 22429 | 41 | - |
| Shanghai Composite | 2602 | 3012 | 51 | - |
| ASX 200 | 5830 | 6067 | 45 | - |
| Hang Seng | 24979 | 29229 | 45 |
US Equity Markets Rebound
Yesterday saw a notable rebound in US equity markets into the close with the DJIA moving towards the psychological 25,000 level, while the S&P 500 found support at the rising trendline from the 2018 low. The positive sentiment spilled into Asian equity markets with the Shanghai Comp and Hang Seng shrugging off the weak Chinese Manufacturing PMI, which shows an evident slowdown in the Chinese economy that continues to feel the pressure from the trade war environment. Supportive measures thus from Chinese authorities have failed to benefit Chinese bourses, which reside in a bear market.
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Difference between Dow, Nasdaq, and S&P 500: Major Facts & Opportunities
Cyclicals vs Defensive Stocks
In light of the recovery in US equity markets, the spread between cyclical and defensive stocks (Risk on Risk off Barometer) curbed its recent selling. However, unless there is a meaningful recovery in the spread, equity markets remain fragile.
Source: Refinitiv
FAANG Earnings May Extend Recovery
After US market hours, Facebook announced their latest financial reports, which were relatively mixed with the tech giant beating on earnings, although, missed estimates on revenue, daily and monthly average users. Despite this, Facebook shares are called to open higher by 3%. Elsewhere, eyes will be on Apple who are due to report after-market tomorrow, whereby option straddles suggest an implied volatility of 6.5% (Historical share price movement has been 3.8%).
Much like the S&P 500, the rising trendline from the 2018 low continues to keep the Nasdaq 100 afloat. However, risk sentiment continues to remain fragile with a move above 7000 needed to suggest a near term bottom.
Nasdaq 100 Price Chart: Daily Time Frame (Dec 2017 - Oct 2018)
KEY TRADING RESOURCES:
- Just getting started? See our beginners’ guide for FX traders
- Having trouble with your strategy? Here’s the #1 mistake that traders make
- See our Q4 forecasts to learn what will drive FX the through the quarter.
--- Written by Justin McQueen, Market Analyst
To contact Justin, email him at Justin.mcqueen@ig.com
Follow Justin on Twitter @JMcQueenFX
