Saturday 4 August 2018

Weekend update - World equity markets

It was a bullish month for world equity markets, with net monthly gains ranging from 8.9% (Brazil), 4.7% (USA), 4.1% (Germany), +3.5% (France), 2.6% (Spain), 1.6% (Russia), 1.2% (Australia), 1.1% (Japan), 1.0% (China), to 0.5% (Greece) Near term outlook offers further upside into Sept/Oct.

Lets take our regular look at ten of the world equity markets

USA - Dow

The mighty Dow gained 1143pts (4.7%) to settle July at 25415. Note the monthly settlement above the key 10MA. Underlying macd (green bar histogram) is seeing the downward swing in price momentum from January level out. A bearish macd cross is currently being avoided, and this bodes well for at least another few months.

Germany – DAX

The economic powerhouse of the EU - Germany, saw the DAX +499pts (4.1%) to 12805, notably above the key 10MA. We have a very clear divergence between price momentum and actual price across 2015>2018. Things would turn exceptionally bearish if core rising trend is broken, and in August that is currently around 11800s.

Japan – Nikkei

Japanese equities gained 249pts (1.1%) to 22553. The m/t trend remains bullish. The long term outlook remains 'beyond problematic', as a demographic collapse is inevitable.

China – Shanghai comp'

Chinese equities swung from an intra month low of 2691, to settle +29pts (1.0%) at 2876. The July candle offers a spike floor, having cooled from January. The Friday Aug'3rd close of 2740 is a problem though.

Brazil – Bovespa

After a rough May/June, the Bovespa caught a very powerful bounce, settling +6457pts (8.9%) to 79220. Despite the gain, monthly price momentum is negative, for the first time since early 2016.

Russia - RTSI

The Russian equity market gained 19pts (1.6%) to 1173. The 1200 threshold remains key. Higher energy prices would really help this market.

France – CAC

The CAC settled +187pts (3.5%) to 5511, notably back above the key 10MA. Next big target is the June 2007 high of 6168.

Spain – IBEX

The Spanish market gained 248pts (2.6%) to 9870. The m/t trend remains bearish from early 2017. Note giant resistance of 12k. Things would turn extremely bearish <8500, but that is a long way down.

Australia – AORD

Australian equities climbed for a fourth consecutive month, breaking a new multi-year high, gaining 76pts (1.2%) to 6366.

Greece - Athex

The economic basket-case of the EU - Greece, gained 3pts (0.5%) to 761, notably under the key 10MA. The Athex is a perfect reflection of a Greek economy that never recovered from the global financial crisis of 2008/09.


All ten world equity markets saw net July gains.

Brazil, USA, and Germany lead the way higher, with China and Greece lagging.

The m/t outlook offers at least another 2-3 months of upside.

Looking ahead

Earnings season continues, notably: TWLO, SNAP, DIS, ROKU, DBX

M -
T - Consumer credit (3pm)
W - EIA Pet' report
T - Weekly jobs, PPI, Wholesale trade
F - CPI, US T-budget

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Have a good weekend

*the next post on this page will likely appear 6pm EDT on Monday.