Market Report 20.09: OIL, FED and TESCO
Good morning, first of all a brief view of last week: the market’s performance ranged from flat to up, depending on which part of the market you look at. The Dow Jones rose negligibly by 0.03%, the S&P 500 also ending only marginally up by 0.04%. The NASDAQ, though, jumped 2.63%. But yesterday after the positive movement in Europe, the markets of Wall Street closed mixed without important changes, in a very volatility day.
After the market broke down on September 9th, out of its narrow trading range which had spanned 2 months, many market players had expected movement characteristic of a downtrend. Instead of that, we got unstable movement that left the S&P 500 trading as a whole practically unchanged, the NASDAQ, though, trading up over 2.5% primarily due to the surge in the stock of Apple.
Every day the internal dynamics between stock, currency markets and central bank policy are as complicated as can be. The best hope for successfully navigating this complex maze of developing issues is to stick to price movement in the stock market. To our lament, it’s not as easy as it seems! We’re going to see no end to speculation on the one hand and concrete information on the other, about what the Federal Reserve and the Bank of Japan may or may not announce in their highly anticipated monetary policy announcements in this week. Despite the fact that, overall, both are expected to resort to a tone of voice that’s calming and inviting, as far as the stock market goes, the market is increasingly anxious about whether further monetary stimulus is positive or negative for stocks.
Meanwhile the Oil prices are trading lower amid fears of oversupply in the crude market. According to Venezuela’s energy minister, global supplies would have to come down by around 10 percent from a current 94 million barrels a day, for output to meet consumption levels. And also Saudi Arabia keeps pumping at record levels. The world’s biggest oil exporter produced 10-point-6 million barrels per day in July, rising by more than 120-thousand from June and hitting a fresh high. And the Crude Oil is trading at about $43.5 per barrel on Tuesday.
British grocery sales rose 0.3 percent in the 12 weeks to the first weeks of September, helped by higher alcohol sales and a strong showing from the country’s biggest supermarket chain Tesco which posted its best performance for over two years. Tesco shares are trading very up, raising +1.3%, the next level of resistance is in 179 eur.
Graphics by: www.etoro.com
The broad stock market extends its consolidation following recent breakdown below two-month-long fluctuations. There have been no confirmed positive signals so far. We need to wait until the FED meeting to see a possible positive stronger correction. In short time the point of support is at 2.125 and the resistance is 2.160.
Graphics by: www.etoro.com
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