Index Weekly Wrap for the Week of Jul 31

Summary of content for the week of  Jul 31:

1. Week 31 major indexes performance;
2. Week 31 US sector indexes performance;
3. Major indexes weekly charts of support and resistance levels;

4. Major indexes monthly performance for July

U.S and Global

U.S stocks closed modestly higher for the week, tech-dominant Nasdaq index led stocks higher, DJI index however closed inched down a little. U.S 2Q GDP released showing the sharpest quarterly decline on record, big tech held earnings spotlight, which reporting results significantly better than expected. However, COVID-19 relief bill was stalled at congress negotiation. 

U.S GDP  US 2Q GDP reported a 9.5% decline( equilalent to a 32% annualized decline), the largest such drop in GDP back to 1947, its 1Q GDP was +0.3%. In comparison, China's 2Q rebounded to +3.2% from 1Q GDP -6.8%. U.S housing remains to be on solid footing, driven by record-low interest rates. 

Earnings The strong getting stronger. Almost half of the SPX 500 earnings derived from sectors are less impacted or even benefit from the pandemic such as tech and healthcare sectors. On the other hand, energy, industrials and consumer discretionary earnings dropped more than 50%. The largest five stocks in SPX 500 i.e. Microsoft, Apple, Amazon, Facebook, and Google now account for about 23% of the index and up 30% on average this year. 

Fed is the key to support stock markets. The Fed vows to do "whatever it takes" to support economic recovery. With ample liquidity and near-zero interest rate for an extended time. I think it's difficult for stocks to drop even headlines news U.S virus cases breaking record on a daily basis. 

Among SPX 11 major sectors, Technology(XLK) outperformed, and Energy(XLE) lagged for the week. Click HERE for more information on XLK ETF available at NYSE ARCA. 

Major Indexes Jul performance Shanghai Composite Index(SSE) outperformed in Jul with 10.9% up and Straits Times Index(STI) was the only one in red with 2.3% down. U.S three major indexes and SSE all recorded 4-month up in a row, HSI recorded 2nd month up straight, STI has been in sideways consolidation mode for 4-month. Refer to the below Index Monthly Performance table.

China/HK

China's official PMI for Jul reported positive figure 51.1 above expansion mark 50 level. Technically, SSE index rebounded for the week, reserving its previous 2-week down. HSI index recorded 3-week down in a row however, the selling appeared moderate with immediate technical support level at 24500. 

Singapore

STI was the worst performer this week with 50pts or 2% down(refer to the below major index weekly performance table). The selloff came in as bad economic data and missed earnings reported, local banks DBS, UOB and OCBC led the selloff as MAS urges them to curb dividend payment. DBS and UOB will be reporting 1H20 earnings results on Aug 6 and OCBC on Aug 7, expected to be watched closely in the week ahead. Technically STI trading just above its major support level 2500, let's see if it can hold in coming week. 

Index Weekly Wrap for the Week of Jul 6

US stocks turned positive this week. The SPX and COMP rebounded after two weeks profit taking, and DJI 1st week after three weeks fell. Both SPX and COMP recorded 3.2% and 11.4% YTD return while DJI appears a bit weak with 1.1% loss YTD. ALL three major US indices uptrends are well intact. The US stocks look not affected at all by the kick-start of US-China trade tariff effective on Friday 6 Jul.  The fear index VIX fell more than 10%, back down to 13.37 on Friday.

On the other hand, Asia stocks continue fell attributed to the trade tariff and strong dollar. Equity Funds continue flowing out of Asia-pacific according to ETF Global Fund Flow statistics (https://www.etfg.com/research/fund-flow).

HSI fell for 4weeks in a row, immediate support is at 28000 level. STI also fell for 4weeks consecutively by now, just dip below 3200 major support level this week, expected the index could rebound around 3167 and 3200 technical support area in coming week(s). The Shanghai SSE index was the most worst performer with 16.9% loss YTD return. SSE is in 7th week continuous down in a row.

Major indices weekly performance and weekly charts are as follows.

Weekly Wrap for the Week of Sep 29, Monthly Index Performance Sep

Last week of Sep, the "Western" indexes clearly outperformed the "Eastern". US three major indexes i.e. DJI, SPX and COMP all closed with new all time high. The indexes just go up and up. On monthly basis, all three indexes gained from 1% to 2.1% for the month of Sep.

In Asia, the indexes look clearly weaker, HSI lost the most for the week with 1.2% down, hit 5wk low, also its first week down after 8 weeks consecutive up. But HSI has been the most outperformed index with stunning 25.2% YTD.

STI has been in three weeks consolidation range just above 3200 key support level, also its 2nd month loss in a row. The index has no direction at this moment. Continue watch 3200 support and 3270 resistance.

China SSE index still under retracement mode for 4th week, also registered its first month down after 3 months consecutive up. Overall uptrend still intact, immediate support at 3300 with plenty of room for upside move. SSE has been the worst performer this year with 7.9% up YTD.

Indexes weekly and monthly performance are in below tables.

Weekly Wrap for the Week of 23 Jun, 2017

US stocks ended the week inched up bit, the DJI and SPX stayed almost flat but technology dominated Nasdaq(COMP) rebounded 1.8% after two weeks profit taking. The Technology stocks index look in great shape.

Over in Singapore, STI was the only index that closed in red this week, lost 0.7% to immediate key support level at 3200, could trigger further selloff if the support level 3200 violated.

Shanghai SSE index rebounded from its key support level 3100 this week, as MSCI announced on Wednesday that it will include 222 China domestic A Shares into its Emerging market index next year 2018. We need to see the index to above 3300 level for uptrending. On the other hand, HSI has been in two weeks consolidation previous strong upside move.

2016 Year End Wrap

Weekly, monthly and indexes performance for the year 2016 as in below tables. For the year, Dow Jones Index(DJI) gained the most for 13.4%, and Shanghai index(SSE) was the worst performer with 12.3% loss. 

From the first table, we also can see the US three markets are outperform the three in Asian, indicating investors were looking good on the US economy and thus prefer putting money there for higher return. 

 

Macau Casino Sector Expected Further Rebound

Macau gaming/casino stocks seen rebounding from rock bottom after suffered two years loss between 60-90%. Time to consider take some shares.

Stocks such as MGM China 2282.HK, Sands China 1928.HK and Galaxy 0027.HK all demonstrating bottom rebounding.

Major Index performance for the Month of Jul

Update you major indexes performance for the month of Jul.

Nasdaq gained the most for 6.6% in Jul, while STI had the least for 1% gain.

Weekly Wrap

As a result of Brexit won on Friday's referendum in UK, global equity and FX markets suffered immediate sell-off. Hard and furious. 

What to buy on Brexit:

1. Safe haven proxies like CHF, JPY, USD and gold will surge
2. Oil prices would come under pressure.

3. Stronger USD 

4. Stocks that benefit include Venture, Innovalues, ST Engineering, SIAEC, Riverstone, and UG Healthcare.

5. Stronger spot gold price
6. Beneficiaries include gold ETF (GLD US$), miners (CNMC Goldmine & Anchor Resources)

7. Lower oil prices
8. Negative for all oil-related counters including heavyweights Keppel Corp & Sembcorp Marine, service providers Ezion & Ezra, as well as upstream oil producers KrisEnergy, Rex, Ramba, etc.

9. UK votes to leave EU, impacts on HK listed companies:

Negative:
HSBC (5) – approximately 25-30% revenue from UK/Europe
Standard Chartered (2888) – approximately 6% revenue from UK/Europe
Textile companies – 15-20% exports are to EU and sales dominated in Euro

Positive:
Yashili (1230) – 50% of raw milk cost of sales in Euro
Brilliance China (1114) – Certain components are imported from EU

For major indexes under my radar, this week marks all indexes YTD return are under water. Weekly index performance as in below table:

STI weekly chart shows its down trend channel is well intacted. The index is under further downside pressure, if it can not hold above immediate support level at 2715.

HSI spiked below its short term uptrend channel intraday on Friday but rebounded and managed to close within the channel, a close below its bottom channel line indicate possible downside reversal, in coming week.

SSE index has been trading within its bottom consolidation range 3052-2663.

SPX dipped below its 2015 YEC level 2043 this week, Formed a double top which is bearish, if it can not rebound from this level in coming week.

Gold ETF GLD finally breakout to upside after multi months consolidation, plenty of room for upside.