Daily Market Report: WALL STREET, US TECH 100, GERMANY 30
Equities retrace off the highs, US losses lead by Apple while Deutsche Bank’s losses hit Germany 30
WALL STREET: Retracing off the highs with earnings season on the way
The index’s technical overview continues to stall heavily at the highs, having recently posted a fresh record last week. As it stands, Fed policy expectations continue to dictate equity flows with markets continuing to price in rate cuts for the year, and that’ll make Fed speak this week even more important in determining where the index will hover towards prior to earnings release. Tech shares were hurt yesterday as Apple lead the losses. Meanwhile, institutional bias has edged even higher to a now extreme long 86% anticipating further gains in this index, especially compared to the tech index.
US TECH 100: Bull trend line barely holding as bullish technicals face an important mid-term resistance level
Tech shares were hurt yesterday, with Apple leading the losses and keeping indices retracing off the highs and their respective mid-term resistance levels. As it stands, monetary easing anticipation out of the Fed has been aiding share pricing globally as yields plummet, which means monitoring the money markets and their reaction to Fed speak this week will be crucial in determining whether risk appetite will rise or fall, especially with the hunt for yield getting more desperate. Going into this week’s Fed events retail bias is heavy long at 70%, while institutional bias is majority long 61%, far below the extreme long bias in Wall Street.
GERMANY 30: Deutsche Bank leads the losses following restructuring
Indices are in slight retreat off the highs at the start of this week, and in the case of Germany 30 it was Deutsche Bank leading those losses with a price drop of over 5% on massive restructuring. In terms of German data, its trade surplus improved yesterday but industrial production grew at a slightly lower than expected pace. Data is less relevant as focus remains on ECB monetary easing aiding shares at a time when European yields are plummeting into negative territories, with the German 10-year yield at -0.368 and near the record -.4 broken last Friday. A price drop lower for this index however, does aid retail traders, whose bias dropped 3% on averaged-in shorts taking profit, and needing more retracement lower to undo short positions initiated at lower price levels.
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