Vaccine Optismism Prompts Market Rotation

 Summary of content for the week of  Nov 13:

1. Week 46 major indexes performance;

2. Week 46 US sector indexes performance;

3.Major indexes weekly charts of support and resistance levels;

U.S

U.S stocks build on gains following vaccine news. All three major U.S indexes added to the previous week's sharp gains and hit new all-time new intra-week highs, DJI and SPX able to close at new high but Nasdaq closed lower as technology stocks trailed most other sectors. 

Stocks surged on Monday after Pfizer and BioNTech announced that their vaccine had 90% effectiveness, triggering a wave of hope that vaccines will address the coronavirus crisis and accelerate the economic recovery. It's expected mass production and widespread distribution of a vaccine will likely take at least months, and in the meantime the virus cases continue to surge to a new high in the States and many of E.U countries. Thus, do expect market volatility along the way of recovery. 

Market Rotation. The Pfizer news prompted a sharp rally in cyclical shares, especially those of travel and leisure-oriented firms. Energy and banks rebounded, conversely "stay-at-home" stocks such as Amazon and Netflix were sold out.

Among SPX 11 major sectors, Energy(XLE) and Financials(XLF) were the two top-performing sectors this week with 17% and 8% gains. Conversely, Technology(XLK) was the only sector closed underwater this week, losing 0.3%. Refer to below SPX sectors' weekly performance table.

China/HK

Shanghai stocks declined slightly for the week as unfavorable macro news outweighed generally positive corporate earnings. U.S-China relations suffered their latest setback when Trump announced prohibiting Americans from investing in Chinese firms that have ties to the country's military. The list of companies includes China Mobile and China Telecom, whose U.S listed shares fell sharply on Friday U.S trading hour.

China's proposed antitrust laws were the second recent setback for China's top internet companies after fintech company Ant Group's IPO was pulled back on Nov 3. Alibaba(BABA) continued under selling pressure on Friday. 

Technically, SSE index still trading within its 4-month sideways price range, under consolidation with bullish bias as the index is well trading above its 50 and 200 weekly MA. HSI index closed 2nd week up, still in bullish momentum as it closed above 26000-level for the first time since early March this year.

On his keynote speech to Caixin Summit on Friday, the billionaire founder of the world's biggest hedge fund Bridgewater Ray Dalio believes now is "Special Moment" for Markets as China ascends. Foreign flows into China's stocks and bonds market seeing very strong. 

Singapore

STI index rallied for 2nd week, was the best performer for the week(refer to my major index performance table below). It has recorded 11.5% strong gains for the last two weeks, recovered some of its loss but the index still underwater 15.87% YTD, one of the worst-performing Asian indexes. Immediate technical resistance at 2733 level-50weekly MA for the coming week.