Author: Midhun Parameswaran

China A Shares

Posted on by Midhun Parameswaran

The CSI 300 dropped 0.55% this week on higher volume and added one distribution day, taking its total to four. The market remains in an Uptrend Under Pressure. China’s November industrial profit, announced Wednesday, widened to a record decline, dampening market sentiment. Ongoing China-U.S. trade negotiations also increased market volatility. Health Care and Staple stocks continued their weakness this week. Longtime leader Kweichow Moutai (

) incurred heavy selling pressure, raising concerns that the market trend may shift. Investors are advised to trim positions in the most extended ideas and watch stocks that are construction-related and could benefit from China’s fiscal and monetary stimulus. The CSI 300 broke below its 100-DMA and is testing immediate support at the 200-DMA (~3,800, +0.7%). If 200-DMA support fails, the next support is at August lows of ~3,575 (+7%). Investors may want to pay attention to China’s November manufacturing PMI, to be released Saturday.

US Focus

Posted on by Midhun Parameswaran

The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq made new alltime highs this week as both continue to trend higher off their respective 10-DMA. Distribution remains low at two days each, with one expiring on the S&P 500 next week. We do expect the market to consolidate gains in the coming days given the sharp move higher over this past week. Should that occur, look for underlying action among quality growth ideas to remain constructive.

European Focus

Posted on by Midhun Parameswaran

On Thursday, the Stoxx 600 ended the day 1.30% above last Friday’s close and remained in a Confirmed Uptrend. During the week, we upgraded the U.K. to a Confirmed Uptrend from a Rally Attempt after a follow-through day. Of the 17 indices we cover, 15 are in a Confirmed Uptrend, and two are in an Uptrend Under Pressure.

Global Focus Emerging

Posted on by Midhun Parameswaran

The CSI 300 dropped 0.55% this week on higher volume and added one distribution day, taking its total to four. The market remains in an Uptrend Under Pressure. China’s November industrial profit, announced Wednesday, widened to a record decline, dampening market sentiment. Ongoing China-U.S. trade negotiations also increased market volatility. Health Care and Staple stocks continued their weakness this week. Longtime leader Kweichow Moutai (

) incurred heavy selling pressure, raising concerns that the market trend may shift. Investors are advised to trim positions in the most extended ideas and watch stocks that are construction-related and could benefit from China’s fiscal and monetary stimulus. The CSI 300 broke below its 100-DMA and is testing immediate support at the 200-DMA (~3,800, +0.7%). If 200- DMA support fails, the next support is at August lows of ~3,575 (+7%). Investors may want to pay attention to China’s November manufacturing PMI, to be released Saturday.

China A Shares

Posted on by Midhun Parameswaran

The CSI 300 gained 1.43% for the week on higher volume. The market remains in a Confirmed Uptrend with four distribution days. The block-chain stimuli did not last long and market sentiment was still impacted by increased downward pressure on the economy. China’s manufacturing PMI declined to 49.3% in October, the sixth straight month that factory activities shrank. As Q3 earnings season ends, we expect market volatility to subside in the near term. The decreasing distribution day count has also boosted our conviction. We are cautiously optimistic and expect the CSI 300 to continue trading sideways above its 50-DMA, which serves as strong support. We look for the next resistance at previous highs of ~3,980. Investors are advised to stay patient and focus on ideas that have recently broken out with strong fundamentals.

US Focus

Posted on by Midhun Parameswaran

The U.S. market is in a Confirmed Uptrend. The S&P 500 and Nasdaq are trading at all-time highs after clearing above multiple levels of resistance throughout the week. On Friday, the S&P 500 cleared above longer-term resistance along its weekly upper channel line. Going forward, we will be looking for indices to consolidate gains constructively, avoiding any big pick up in distribution, while support along the 21- and 50-DMA catches up to current prices.

European Focus

Posted on by Midhun Parameswaran

On Thursday, the Stoxx 600 ended the day 0.32% below last Friday’s close and is in a Confirmed Uptrend. During the week, we upgraded Switzerland and Luxembourg to a Confirmed Uptrend after they breached their previous rally highs. Of the 17 indices we cover, 15 are in a Confirmed Uptrend, one is in an Uptrend Under Pressure, and one is in a Rally Attempt.