Inter Market Analysis – 26th June

Inter Market Analysis 25th June 2015

Equity

World markets

Shanghai 4,192.87 -334.91 (-7.40%)
S&P 500 2,102.31 -6.27 (-0.30%)
Nikkei 225 20,706.15 -65.25 (-0.31%)
Hang Seng Index 26,663.87 -481.88 (-1.78%)
TSEC 9,462.57 -13.77 (-0.15%)
EURO STOXX 50 3,584.24 -26.67 (-0.74%)
CAC 40 5,006.34 -35.37 (-0.70%)
S&P TSX 14,897.50 -50.01 (-0.33%)
S&P/ASX 200 5,545.90 -86.80 (-1.54%)
BSE Sensex 27,806.23 -89.74 (-0.32%)
TA25 1,671.33 -10.99 (-0.65%)
SMI 8,944.35 -100.97 (-1.12%)
ATX 2,481.08 -18.39 (-0.74%)
IBOVESPA 53,175.67 -666.87 (-1.24%)
SET 1,519.59 +0.12 (0.01%)
BIST100 83,276.08 -1.02 (-0.00%)
IBEX 11,270.70 -37.70 (-0.33%)
WIG 53,992.87 -148.33 (-0.27%)
TASI 9,367.29
MERVAL 10,069.91 +59.92 (0.60%)

Risk On

  • Tesco beat forecast
  • US hospitals win Obamacare (hospitality stocks rose)
  • Italy consumer confidence rose 109.5 vs 105.7

Risk Off

  • China Equities turmoil all eyes on Xinhua and Government to do something about it (impending stimulus?)
  • Asian equities lower and Nikkei closes -0.31% (need weaker yen but yen bought as safe haven)
  • Greece deadline Saturday
  • Lower German Import price index in May -0.2% against +0.2%

Outlook: No deal as of yet, deadline moved to Saturday. Expect Monday blood bath on global equities. China big Risk Off but stimulus imminent over the weekend is a possibility. What happened post Greece? Mind you GAPs need to be filled.

Biased: Friday cautious play but looking to buy once GAP filled. Risk Off to begin with but will play by ears.  

Currencies

  • OPEX at 10 am NY
  • SNB Jordan say Franc still too strong
  • Banks are expecting Euro parity against the dollar no matter what happened to Greece
  • No resolution yet so Dollar well bid with IHS formation still possible

Outlook: Dollar on the back foot but the IHS could still be in play

Biased: Neutral but watching the dollar index closely.

Bonds

  • Note inside day on 19th June and yesterday we have another inside day that is close to the mid Bollinger band – might see a continuous sell off
  • PA still trade below the 20 MA and daily RSI maintain bullish divergence
  • Bollinger Band converging for a potential breakout

Outlook: Lower Bunds will send yield higher – favour Euro – deal imminent?

Biased: Biased for one more leg lower-possibly a double bottom at 148.50 level

Commodities

  • Silver Crashed at 7 am London open to 15.52 (spiked higher and back to unchanged – thus created a hammer)
  • Palladium sell off to 2013 September low (still heading lower at the moment)
  • Copper attempting a IHS formation but still in downtrend channel

Outlook: China imminent stimulus package to save the economy at 7% growth?

Biased: Neutral with a bias for a corrective rally with a safe haven biased as traders look to get some weekend insurance in case Greece fall out.  

Watch lists

Dollar Index

IHS is still in play unless it trade out of the symmetrical triangle. PA still trading below the 100 ma.

German Bund

Hit resistance and could resume lower despite bullish RSI divergence

Copper

IHS formation but hit resistance and China stock turmoil might mean imminent stimulus – Buy on breakout.

Palladium

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