Index Weekly Wrap for the Week of Mar 6

Summary of content for the week of Mar 6:

1. Week 10 major indexes performance;
2. Week 10 US sector indexes performance;
3. Major indexes weekly charts of support and resistance levels;

U.S
U.S stocks edged higher by Friday close after a roller-coaster week. Fed had a surprise rate cut by 0.5% in its first emergence move since 2008 as a response to coronavirus outbreak and spreading fast to Europe and U.S itself. U.S 10-year treasury yield falling below 1% for the first time in history as a result of rate cut and capital flight to safety and economy growth concern due to virus impact. The latest Feb employment data beat expectation but the positive news was discounted by market. 

The biggest question in everybody's head is this a buying opportunity? Short answer is yes. As I said in previous post, the coronavirus impact will be meaningful but will not last long. Once virus is contained, market will rebound. The concern for economy recession is less likely given the current supportive monetary policy conditions. Take a look at below table for historical events and market performance.

Among the 11 major SPX sectors, defensive sectors outperformed, such as Utilities(XLU) and Consumer Staples(XLP), the Financials(XLF) and Energy(XLE) lagged. Refer to below table for SPX sector weekly  performance.

Technically, DJI rebounded and just closed above its 50% fib level 25640, SPX stronger and closed just beneath its 38.2% fib level 2993, it touched 50% fib 2870 level and rebounded; the technology dominant Nasdaq(COMP) index is the strongest among the three, it tested 38.2% fib 8444 level and closed above it this week. Continue watch these important fib levels 38.2%, 50% and 61.8% in coming week(s), while watching closely coronavirus continue spreading in EU and US.

China/HK
Shanghai SSE index had stunning weekly gain of 5.35% for the week, as data shows coronavirus cases in China peaked in Feb, this coincided with SSE index's bottom rebound. China's Q1 economic data expected to be negative affected but appears to be short-term when virus is contained and factories slowly operation normalizing. 

Technically, SSE index is testing its major resistance 3040 level and HSI index is weaker affected by developed markets but expected to have limit downside, near to its major support level 25800 which is 50% fib level also its 250 weekly MA. Not forgetting HSI will also get support and positive momentum from SSE.

Singapore
STI currently trading at its 5-year 61.8% fib level and 3-year low 2960 level. A key level to watch. Expected more downside if this level is broken, immediate support will be 2900, then 2800 level. Last weekly candle is bearish. Refer to below major indexes weekly charts.