Main Markets Summary–16 June 2011–Greece (again)

European markets got hammered yesterday, the record drop going to Spain (-4.95%), but an average of –4.10% for the Eurozone. The market is clearly disappointed by the delaying tactics of the ECB, and the lingering disagreements between Germany and France.

Credit markets in general had a very good day, it’s the first time since the beginning of the sell of that we observe a “flight to safety”, with US treasuries up 1.8 %. Junk bonds are still having a hard time, being below the short term moving averages, but are not breaking down.

Best equity markets (further above 200 ma) : Ireland & Switzerland

Most oversold equity sectors : Solar, Shipping. With a PE of 12, the solar sector starts to look cheap, despite the oversupply that is expected until 2012.

US Indexes, Equity Sectors (US & Int.), Commodities Int. Equity Indexes, Real Estate, Bonds
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Permanent address for the market snapshot, updated daily around noon Singapore time

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Four hints that we are in a minor correction

With QE2 nearing an end, the US economy slowing down, and commodity prices hurting the fragile recovery, the question on every investor’s mind should be “Is the current sell-off a minor correction, or the beginning of something more serious?”

There’s plenty of fundamental information suggesting that equities are attractive, and just as many that shows that the economy is rotten and that stocks could crater. So how about listening to the market to assert the situation?

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Main Markets Summary–7 June 2011 – Bernanke speech shakeout

Summary of the Bernanke speech : The economy is weak, the fed will continue to accommodate, inflation is temporary, no QE3. The confirmation of no QE3 is widely thought to be behind the market sell-off.

In a nutshell

US indexes and all sectors are now under the 50 days moving average except utilities & healthcare. Financials are still the weakest link. Wind & Solar sectors are showing a surprisingly strong performance. Food and industrial commodities registered moderate gains

Europe overall had a pretty good day, with Spain, Sweden as well as Poland and emerging Europe. In emerging Asia, Vietnam had a strong day – might finally be bottoming. Bonds have had a decent but not outstanding day.

Technical Ranks

Top 3: Gold, Poland, Colombia

Bottom 3 : Nickel, Livestock, Cocoa

 

US Indexes, Equity Sectors (US & Int.), Commodities Int. Equity Indexes, Real Estate, Bonds
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Click for the snapshot
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Permanent address for the market snapshot, updated daily around noon Singapore time

Main Markets Summary – 03 Jun 2011 – General Sell-off

All main equity markets are now below the short term moving averages. Eurozone is still getting some traction from the bailout, and is showing a good performance.

Tech is still sticking out for its broad underperformance : NASDAQ, the SP Technology and Internet companies are all showing among the worst short term returns.

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Risk ratios weekly update – June week 1

I have updated the risk appetite ratios. I’d like to highlight two of them :

1] Emerging Markets vs USA

Emerging markets are recovering vs US markets.
Is it a sign of the “Risk Trade” appetite recovering, or of a slowing US economy ?

2] Junk Bonds strength

Still showing strength. US mid to large caps are healthy.
It’s too early to panic over the reports of a slowing US economy.

All ratios available here

Main Markets Summary – Another Greek Bailout

The greek bailout staged a strong recovery day among most equity markets, the main beneficiary being the eurozone, a couple of emerging markets tagging along.

Details

Equities : A weak rebound in the US, however the fears of a short-term correction seems to be going away. A very impressive day in green energies (both Solar and wind)

There was a very strong day in the eurozone lead by the Greek Bailout with gains north of 3% for many countries. Most significant performers are Spain, France, Germany, Italy, UK & Poland.

The arab world is still having a hard time overall (below all MA), except Egypt that is showing strong short-term momentum since the revolt’s end. Turkey had a very good day too, perhaps staging an exit from a long streak of underperformance

Vietnam is closing the pack, showing the worst performance of all countries.

Bond Market : Not much to report, except maybe that junk bonds are overall still doing good (short and medium term momentum still positive).

Commodities : Mixed. Oil is still heading higher, starting to pull Nat Gas along. Cotton is edging up, trying to recover its former strength. It’s still the commodity with the strongest momentum (+134% TTM)

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