Index Weekly Wrap for the Week of Jul 24

Summary of content for the week of  Jul 24:

1. Week 30 major indexes performance;
2. Week 30 US sector indexes performance;
3. Major indexes weekly charts of support and resistance levels;

U.S and Global

U.S stocks declined modestly for the week. SPX and DJI closed 1st week down after three-consecutive weeks up. The SPX index turned intra-week positive for 2020 but pulling back on concerns over escalating China-US tensions. There are many factors contributing to the market forces, it's believed the road to recovery will likely slow and bumpy going forward. Here are some positive and negative factors. Refer to below major indexes weekly performance table.

Positives:

1. The EU leaders agreed on a landmark stimulus package to help member states mitigate the economic downturn. U.S also is preparing a new round of stimulus to continue to support current household relief measures which will expire at the end of July;

2. Housing market data is showing itself as a bright spot in the economy, as a result of mortgage rates have fallen further to 3% this week from 3.7% in Jan. Housing, as one of the most interest-rate-sensitive sectors of the economy, is an important watchpoint for stocks.

3. Scientists and medical professionals are racing for a vaccine and the hopes to have a vaccine eventually getting greater as time passed. 

Negatives:

1. U.S initial jobless claims increased for the first time since March, raising worries the recovery is beginning to stall;

2. China-US tensions escalating to new high levels which could put phase one deal implementation in question;

3. The ballooning debt and credit levels due to the unprecedented both fiscal and monetary stimulus package around global countries. Dented corporate earning and permanent job losses as COVID-19 pandemic's impact on the economy. 

The most common question likely is stocks have recovered since March sell-off. Should I wait for equities to drop again before I invest? That being said, it's difficult to timing the market by waiting for the "perfect" time to invest. Given the long term outlook for the economy to gradually improve and stocks to continue grind higher, instead of staying on the sidelines one should consider a systematic approach on investing, such as dollar-cost averaging. (Click HERE for more information on dollar-costing averaging). 

Among 11 SPX major sectors. Energy(XLE) and Financials(XLF) outperformed this week. while Technolgy(XLK) and Communications services(XLC) fared worst, dragged down by declines in Apple(AAPL) and several chipmakers such as Intl Corp(INTC). While INTC dropped more than 16% on Friday, its rivals Advanced Micro Devices(AMD) and Taiwan Semiconductor Manufacturing( TSM) jumped 16.5% and 9.7% respectively. Refer to below SPX major sector indexes weekly performance.

Gold and Silver Gold has been continuously bullish and reached $1900.3 per ounce- approaching to the historical high of $1923.7 in Sep 2011. Gold ETF "GLD". Silver ( ETF: SLV)also rebounded to its high in 2014 but still far away below its historical high of 48.35 in 2011, still plenty of room to upside. Refer to below Gold futures and SLV monthly charts.

Earnings to focus for the coming week.  

Jul 28: MMM 

Jul 29:AMD; 

Jul 30: FB

Jul 31: Alphabet(GOOGL), AAPL, AMZN

Full earning calendars for next week click HERE 

China/HK

China and HK stocks declined this week, weighted by a Friday sell-off on news White House ordered to close China's consulate in Houston, Texas. Technically, Both SSE and HSI index down for 2nd week in a row. Technically, SSE immediate support level to watch 3150 and HSI 24500.

Singapore

STI immediate support at 2572 then 2500 major support. Refer to major indexes weekly chart below.

Index Weekly Wrap for the Week of Jul 17

Summary of content for the week of  Jul 17:

1. Week 29 major indexes performance;
2. Week 29 US sector indexes performance;
3. Major indexes weekly charts of support and resistance levels;
4. Major indexes monthly performance for June.

U.S

U.S stocks finished out a bumpy week mixed. SPX and DJI closed 3rd week up in a row but the technolgy-dominant Nasdaq closed lower. SPX reached intra-week level not seen since the market selloff began in late Feb, at its peak Wednesday, the index was briefly in positive territory for the year. Market seen shift out from high valuation growth stocks to value stocks, caused Nasdaq to pull back from its all-time high.

Earning seasons kicked off started this week, several major banks reported deep drops in profit. But early vaccine hopes boosted sentiment as Moderna Therapeutics announced its novel vaccine had produced high levels of antibodies in all tests. Oxford University also announced progress in their vaccine candidate. Coming week, market should be continue focus on vaccine front, major companies' earnings, and US-China tension.

Technically, SPX index is trading above all its 20/50/200dma, has been trading in a 3-day short term sideway range near recent peak. A breakout from its last 3-day range up or down should provide an early signal.

China/HK

Shanghai index SSE slumped in a volatile week amid economic data, renewed U.S trade tensions, and profit-taking following recent rally. China's 2Q GDP beat expectation at 3.2% growth rate, reversing a historica 6.8% contraction in 1Q. SSE index technical trend remains bullish, it rebounded a bit after hitting its 20dma on Friday. HSI experienced profit-taking after recent rally as well. 

Singapore

STI index closed down 2nd week in a row. Technically, the index immediate upside target 2750 and downside support 2572 level.

Index Weekly Wrap for the Week of Jul 10

Summary of content for the week of  Jul 10:

1. Week 28 major indexes performance;
2. Week 28 US sector indexes performance;
3. Major indexes weekly charts of support and resistance levels;
4. Major indexes monthly performance for June.

U.S

U.S finished higher with the technology sector extending a recent surge that returned the Nasdaq to record highs. COVID-19 and economic data are two major forces that dragged markets back and forth. Technically, it appears something big about to happen. Refer to SPX weekly chart below, the index has broken out from its 3-week consolidation range and closed just at its downtrend line(purple line). 

China/HK

China stocks jumped at the start of trading Monday, with many attributes the strength to a front page editorial in the China Securities Journal, which stated that  “fostering a healthy bull market after the pandemic is now more important to the economy than ever”. After June's positive economic data, many analysts have upgraded their 2Q estimates for China's economic growth. 

Hong Kong stocks seen international and mainland funds continue flowing in at the start of Monday but gave back most part of its gain by profit-taking on Friday.

Singapore

STI closed flat in the shortened trading week. Market closed for the general election on Friday. Technically the index downside support at 2572 level. 

Index Weekly Wrap for the Week of Jul 3

Summary of content for the week of  Jul 3:

1. Week 27 major indexes performance;
2. Week 27 US sector indexes performance;
3. Major indexes weekly charts of support and resistance levels;
4. Major indexes monthly performance for June.

U.S

U.S stocks finished the week higher in the shortened Jul 4th holiday week. This week also marked the end of the second quarter. DJI index having its best quarter on record since 1987, closing up 17.8%. The overall stock market performance as measured by the SPX declined 4% for the first six months of the year, it contained a 35% decline from Feb's record high and a 44% rally from march's low. Refer to major index monthly performance table below.

Solid economic data, particularly about the labour market, offset coronavirus second wave fears. Pending homes sales also seemed to support sentiment. The technology-heavy Nasdaq index(COMP) hit a record new high. Technically, SPX has been trading in a back and forth sideways consolidation manner with no clear direction. Refer to the major index weekly performance and weekly charts below.

Within SPX 11 major sectors, the small real estate(XLRE) and Communication Services(XLC) particularly strong. Financials(XLF) and Energy(XLE) shares lagged. Refer to the below sector index performance table below.

China/HK

China's CSI 300 index hits two and half year high as recovery unfolds, the more broad market measure Shanghai Composite Index(SSE) hit more than one year new high since Apr 2019. Sentiment brightened as Caixin/Markit  MPI rose to a six-month high of 51.2, and China's official PMI rose to 50.9-4th straight month above 50. Technically SSE breaks out its big triangle pattern drawn from 2018 high(refer to below SSE weekly chart) which is a bullish signal. 

HSI index also rose to close at high since Mar 9 week, despite of news headlines worries of capital outflow after China introduced a national security law for HK taken effective on Jul 1. Technically, HSI is poised to test 26,000 level in coming week.

Singapore

STI formed a bullish reversal candlestick on its weekly chart which is bullish, this came after three-week down in a row. Expected to continue rebound with immediate technical support at 2600.