Index Weekly Wrap for the Week of May 10

Summary of content for the week of May 10:

1. Week 19 major indexes performance;
2. Week 19 US sector indexes performance;
3. Major indexes weekly charts of support and resistance levels.

U.S
First of all, wish all mums out there a very Happy Mother's Day.

In the face of bad news out, markets failed to go lower, a rally Friday afternoon pulled back the major indexes from their worst weekly declines since late Dec as the U.S-China trade dispute escalated. The U.S. raised tariffs to 25% from 10% on $200 billion in imports from China on Friday May 10, while Donald Trump proposed increasing tariffs to 25% on another $350 billion in imports, that will include all imports from China. In return, China vowed to retaliate. 

The fact markets failed to go lower after initial knee-jerk selloff could be a significant signal, that markets continue to expect the U.S and China to reach a deal at some point, since both sides have incentives to want an agreement. While the fundamental of economics and corporate earnings are still very much intact. The "fear" index VIX spiked to its highest level since late Jan before back down on Friday.

Among S&P 500(SPX) 11 sectors, the typically defensive Consumer Staples(XLP) held up best, Technolgy(XLK) performed the worst, as heavyweight Apple(AAPL) dropped. Industrials( XLI) and Materials(XLB) also weak as investors worried about rising trade barriers. Refer to below sector indexes weekly performance table.

China/HK
HSI and China SSE indexes were the two worst performer this week, lost 5.1% and 4.52% respectively, pushing them near 3-month low. But the SSE index staged a "V" shape rebound on Friday afternoon after U.S officially announced tariffs increase, it's reported Chinese state-owned funds came in to support the markets. While Trump's latest tariff escalation dealt to blow to investor sentiment in the short term, many analysts think it won't have a lasting impact on China's economic fundamentals. Technically, SSE index rebounded up after touched its 50% Fibonacci retracement level from low to high this year, which serves as an important support level to watch(50% fib=2863). 

Singapore
STI posted its biggest weekly decline since Oct 2018, the index major uptrend still intact and immediate technical support level at 3240-3270.