Index Weekly Wrap for the Week of Feb 28

Summary of content for the week of Feb 28:

1. Week 9 major indexes performance;
2. Week 9 US sector indexes performance;
3. Major indexes weekly charts of support and resistance levels;

U.S
U.S stocks suffered their worst weekly decline since 2008 financial crisis, the three U.S major indexes fell into correction territory--down more than 10% from their recent peaks just a week earlier. (Refer to below major indexes weekly performance table). The fear index CBOE Volatility Index(VIX) spiked to near 50 on Friday, its highest level since the global financial crisis in 2008. And the only culprit is the coronavirus, which seeing rapid spread to other 52 countries globally outside of China. 

However, a slightest sign of relief on Friday as U.S stock rallied in final moments of trading to closed well off their day low on Friday. Nasdaq even crept into green. As Fed issued statement promising to take appropriate measures to support the economy. The coronavirus impact is viewed as meaningful but not permanent. It will slow down the economy but not totally derail economic growth prospects. Given that ample liquidity in the market, supportive monetary and fiscal measures, still good corporate earnings. The economy should pick up quickly once virus put under control. 

Having said that, do expected great volatility return to stock market as VIX surged. The VIX has been extremely low and quiet for the whole last year and do expect a return of normal volatile market. Despite the correction recently, U.S stocks are still up 6% over a 12-month period.Technically, US indexes are still in major uptrend and the technology dominant Nasdaq(COMP) is the strongest one. (Refer to below major indexes weekly charts). 

China/HK
I will have a follow up post for Great Sales Shopping List for Singapore, and HK/China stocks separately. Stay tuned.

The rapid spread of coronavirus to other countries has drawn attention away from China, where recent news has been relatively encouraging. China SSE index has been held up relatively well compare to other markets but on Friday, the SSE index jumped off 3.7% down responding to panic selling on U.S markets on Thursday. SSE index lost 5.24% this week versus 11.49% for SPX.

There is a switch of emphasis in China away from lockdown and quarantine to getting quickly back to work to reduce damage to the economy. Whereas in HK, HSI index lost the least of 4.32% for the week, expected there are limited downside for the index as it's already near its major technical bottom range.( refer to below major indexes weekly chart).

Singapore
STI has broken down its uptrend line decisively this week to near its Jan 2019 low, the weekly candlestick chart is bearish but do expect major technical support at around 3000 to 2955 which is Oct 2018 low, when the trade tariff war began between U.S and China and spooked investors for panic selling.