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Weekly Stock & Metal market reviews after 23rd September, 2011.


Markets were disappointed by the steps of US Federal reserve. On the other hand rating agencies probably forgot about those Greece banks otherwise they should be downgraded them before those French banks. Looking at these things European officials are preparing themselves to recapitalized 16 banks, who failed the stress test in last summer.

INDEX
23rd-Sep, 2011
9/16/2011-9/23/2011
9/9/2011-9/16/2011




DOW
10771
-6.41%
4.70%
FTSE
5066
-5.62%
2.95%
CAC
2810
-7.29%
1.91%
DAX
5196
-6.76%
7.40%
NIKKEI
8560
-3.42%
1.45%
HANG SENG
17668
-9.18%
-2.06%
AUS
3903
-5.92%
-1.07%
SHANGHAI
2433
-1.97%
-0.60%
SENSEX
16162
-4.55%
0.39%
BOVESPA
53230
-6.95%
2.56%
RUSSIA
5427
-11.94%
0.58%
INDONESIA
3426
-10.66%
-4.07%
KOSPI
1697
-7.77%
1.54%
STRAITS
2698
-3.26%
-1.27%
THAI
958.16
-7.24%
-2.73%
ARGENTINA
2482
-9.74%
-0.10%
S. AFRICA
30061
-3.18%
2.00%

Corrections in Russia and Indonesia were large comparing to others. Indonesian market are facing almost 15% correction during last two weeks. Bad economic reports continue to come from Euro area as their private sector contracted for the first time in 2 years and factory output now contracted for 2 months in a row. Now if we think that only US and Euro areas are suffering then it will be wrong, New Zealand economy slows in the 2nd quarter and on the other hand we have seen that many countries are facing reduction in growth due to rate hikes. So things are little disturbing right now.


Metal Market

As situation around the world is deteriorating so Crude Oil is dropping more and if situation doesn’t improve I don’t think it will rise, rather it has a chance to drop more. Nymex Crude is facing the support of $80 and Brent is getting the support of $103.
Gold was definitely in overbought condition, this week it broke the support of $1750 so a fall was inhabitable. Now it has a support around $1625 area and if it breaks that then it can drop more, but I don’t think that is going to happen considering the economic factors. Suddenly many are expecting Silver like corrections (that happened few months ago) in Gold too. But talking about few months correction will be wrong this week Silver again faced huge corrections. Now $34 again becomes it’s resistance in the upside. There is nothing new in Copper, as it will continue this move unless there are some improvements in the global events.


Stock market forecast for Coming week

Now world equity markets are in a position where by it is little difficult to understand clearly what is going to happen in coming days. Overall momentum is negative, there are lot of confusions which demand some clarity.
DOW was unable to test that crucial 11800 level and it makes a gap in the chart, which is not good. I am still in my last week stand if DOW doesn’t break 11800 level in the upside then it has a chance to drop, but before that it may re-test 11200 level again.
As I said in last day that DAX may test 5200 level again this week it did the same thing. It makes a gap in the chart that is not a good sign. If things get bad then it may test 4800 level. On the other hand if situation improves then it may test 5600 level.
Brazilian BOVESPA was making a bearish pattern and it just break-out from that, it was quite expected as I said last week. Now it has a chance to go below 50000 level.
Shanghai Composite Continued it’s move of making lower highs and lower lows. This week it break a crucial level of 2440 and if things continues it will make more lows. Now if it able to break 2500 convincingly on the upside then it has a chance to rise.
KLSE broke a crucial support of 1420 and this fall was due as I said last week. Now 1350 becomes a crucial support for it and on the upside and 1440 becomes it’s new resistance.



Reports due in coming days


Monday, 26th September, 2011 – New Home Sales

Tuesday, 27th September, 2011 – Housing Price index. Consumer Confidence.
Wednesday, 28th September, 2011 – Durable Goods Orders
Thursday, 29th September,2011 – Unemployment Claims. Q-2 GDP Revision, Pending Home sales.

Friday, 30th September. 2011 – Consumer Income & Spending, Chicago PMI, Consumer Sentiment.


European reports are not reflecting any good thing, reactions among socialist and general public may be a matter that must be worrying geek authorities. In coming week we may see intervention of different central banks in their respective markets, which may make things more complicated.
Investors are really confused about investing they don’t understand what to do. Let think about the housing market in US, as price are falling more, in spite of that buyers may be waiting for more and more drops. These are definitely negative sentiments.
Fed’s new steps are definitely reflecting that there will not be much improvements up to 2013. Unless some special events happen we are sure that there will not be any QE-3 in this year. Many are suspecting that fed measures may rise the inflation but I think that is better for them to accept than unemployment.


NOTE :  Please see the disclaimer of this blog .

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