On Thursday, the Stoxx 600 ended the day 1% below last Friday’s close and is in a Confirmed Uptrend. During the week, we upgraded France to a Confirmed Uptrend after it reached new highs and downgraded Finland to an Uptrend Under Pressure after it breached its 200-DMA. Of the 17 indices we cover, 11 are in a Confirmed Uptrend, two are in an Uptrend Under Pressure, and four are in a Rally Attempt
Author: Saminathan Jaganathan
Global Focus Developed
Australia’s ASX All Ordinaries Index was down 0.22% this week. The index added one distribution day, taking its total to three. It remains in a Confirmed Uptrend.
Global Focus Emerging
The CSI 300 dropped 2.1% for the week on lower volume and remains in a Confirmed Uptrend. The number of distribution days is now at five over the past three weeks. We are watching to see if clustering becomes an early sign of market pressure. The market continued moving sideways as trading volume further declined. With the National Day holiday approaching, wait-and-see sentiment is strong; conservative investors tend to reduce positions or hold cash in case of uncertain events in overseas markets during the holiday. China’s industrial profits fell 2% in August, reversing the previous month’s gain (2.6%) and a sign that the economic growth is still bottoming. The possible impeachment of U.S. President Trump cast another shadow over trade tensions. Although the market is in an Uptrend, we remain cautious due to recent heavy selling pressure. The CSI 300 is testing 50-DMA support and we expect consolidation to continue in the near term. Investors are advised to stay cautious, focusing on quality growth stocks with good prospects.
Global Focus Frontier
National Bank of Kuwait is the leading banking group in Kuwait in terms of assets, customer deposits, and customer loans and advances. Its strong leadership position across its product offerings will pave the way for its future growth.
China A Shares
The CSI 300 rose 0.6% for the week, still in a Confirmed Uptrend with one distribution day. Volume has stayed above average, with only four trading days this week due to the Mid- Autumn Festival Friday. Markets remain volatile after important economic data released this week. China’s CPI rose 2.8% y/y in August, exceeding consensus. PPI fell 0.8% y/y, the second consecutive monthly decline, showing mounting downward pressure on the economy. China’s new loans, social financing, and M2 money supply were all up in August. On the trade war front, U.S. President Trump said he would delay tariff increases until October 15, boosting sentiment. Our conviction has increased due to recent policy easing, expected to boost the economy and ease trade tensions in the short term. Remain patient, as the CSI 300 may continue consolidating in the near term after rallying 11% from August lows. Focus on quality growth leaders with good prospects. The CSI 300’s immediate support is at ~3,900, with the first level of resistance at ~3,985 and the second at ~4,100.
US Focus
The U.S. market remains in a Confirmed Uptrend. The S&P 500 is now testing resistance at all-time highs, while the Nasdaq is trading ~2% below that level. Distribution went unchanged this week at three and five days respectively with one expiring on each index Wednesday. We will be looking for a breakout into new highs in the coming days, however, to remain constructive on a potential pullback, we will be looking for the major averages to hold above their respective 21- and/or 50-DMA while avoiding any significant pickup in distribution. The 21-DMA is set to cross above the 50-DMA on both indices next week.
European Focus
On Thursday, the Stoxx 600 ended the day 1% above last Friday’s close and is in a Rally Attempt. During the week, we downgraded Denmark to an Uptrend Under Pressure after it breached support at its 50-DMA and upgraded Switzerland to a Confirmed Uptrend after it reclaimed its prior high. Of the 17 indices we cover, ten are in a Confirmed Uptrend, two are in an Uptrend Under Pressure, and five are in a Rally Attempt.
Global Focus Developed
Australia’s ASX All Ordinaries Index was up 0.36% this week. The index added one distribution day, taking its count to four. It remains in a Confirmed Uptrend.
Global Focus Emerging
The CSI 300 rose 0.6% for the week, still in a Confirmed Uptrend with one distribution day. Volume has stayed above average, with only four trading days this week due to the Mid-Autumn Festival Friday. Markets remain volatile after important economic data released this week. China’s CPI rose 2.8% y/y in August, exceeding consensus. PPI fell 0.8% y/y, the second consecutive monthly decline, showing mounting downward pressure on the economy. China’s new loans, social financing, and M2 money supply were all up in August. On the trade war front, U.S. President Trump said he would delay tariff increases until October 15, boosting sentiment. Our conviction has increased due to recent policy easing, expected to boost the economy and ease trade tensions in the short term. Remain patient, as the CSI 300 may continue consolidating in the near term after rallying 11% from August lows. Focus on quality growth leaders with good prospects. The CSI 300’s immediate support is at ~3,900, with the first level of resistance at ~3,985 and the second at ~4,100.
Global Focus Frontier
National Bank of Kuwait is the leading banking group in Kuwait in terms of assets, customer deposits, and customer loans and advances. Its strong leadership position across its product offerings will pave the way for its future growth.
