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Global Market Wrap:
Upbeat Sentiment In European Trade
Equity Futures: Dow +21.00. S&P -+2.00. NASDAQ +2.70. Japanese Nikkei -11.00. German Dax -3.00.
European Trade: European shares started the day on an upbeat sentiment, even though the cash equity market had closed in the red over the last few trading sessions. The S&P futures saw side-ways action throughout the overnight session, lacking a clear direction or trend and have just started to test the long side of Wednesday trade.
Almost every regional index is trading higher in Europe, with the strongest gains coming from Nordic markets. As such, Denmark’s Copenhagen 20 Index, Finland’s OMX Helsinki Index and Norway’s OBS Index advanced between 1.10% and 1.30%. At the same time, the emerging European markets saw mixed trading action, while the heavyweight German Dax gained 0.40%. Despite the market’s broad strength, some equity markets also declined. Since the day had started, Luxembourg LuxX index lost 0.30%, while the Irish Overall Index fell 0.15%.
S&P Technical View: TheLFB Member Charts
Sector Moves: The market was pulled higher by the gains posted in the utilities, technology, oil & gas and basic resources sectors. The basic resources sector, which again had the biggest contribution to the markets’ overall advance, gained 1.20% aided by the strong gains posted overnight by crude oil and gold. Xstrata advanced 3.20%, while BHP Billiton and Rio Tinto gained approximately 2%.
Utilities advanced on the news that Areva SA may provide to Electricite de France SA the control of its nuclear reactor unit. In a different news report, Poland might build a nuclear power plant using Areva’s technology. Areva is currently trading up 2%, while the utilities sector advanced 0.75%.
Economic Moves: There was only one red-flag news release during the European session, the MPC Meeting Minutes. The report showed that the Governing Council was split in three over the fate of the asset-buying program, with seven members voting for a £25 billion increase, up to £200 billion. At the same time, one member voted for a £40 billion increase while another one voted to leave the size of the asset-buying program unchanged.
During the upcoming U.S. session, investors prepare for the U.S. and Canadian CPI numbers, and for the U.S. Building Permits numbers.
Crude oil was recently trading at $79.95 per barrel, higher by $0.80.
Crude oil Technical View: TheLFB Member Charts
4 Hour chart trend: Mixed. Main price points: 75.50, and 82. Looking for: Wave V)
Oil prices are trading higher, away from the 75.50 support area discussed recently. A long, Wave V), move now looks to be in progress as the market is breaking through the upper resistance line of a corrective channel shown in wave IV).
A daily close outside of this trading channel will put 83-84 target area in play. Once that target area is reached, traders should be very careful with any new long positions, as a turning point maybe seen after the red wave V) completes the up-trend.
Gold was recently trading up by $7.50 to $1146.90.