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Weekly Stock & Metal market reviews after 7th October, 2011.


Are these rating agencies read the matter fully or they just …………..  !    As we know in past, S&P made a problem in the time of downgrading US. And now when ECB is telling about financing those Banks, then what these agencies are trying to do by downgrading ?  Where they were in past ?  Look like these Rating Agencies are preparing a list of other countries who will be next after the close of Greek episode.  Is it Portugal ?

In spite of better payrolls report, Stock markets in US dropped in the last day due to that Fitch matter related to Italy & Spain.

INDEX
7th-Oct, 2011
9/30/2011-10/7/2011
9/23/2011-9/30/2011




DOW
11103
1.74%
1.31%
FTSE
5303
3.41%
1.22%
CAC
3095
3.82%
6.08%
DAX
5675
3.14%
5.88%
NIKKEI
8605
-1.09%
1.63%
HANG SENG
17707
0.65%
-0.43%
AUS
4162
3.84%
2.69%
SHANGHAI
2359
0.00%
-3.04%
SENSEX
16232
-1.34%
1.80%
BOVESPA
51243
-2.06%
-1.70%
RUSSIA
5569
-2.29%
5.03%
INDONESIA
3425
-3.49%
3.59%
KOSPI
1759
-0.56%
4.24%
STRAITS
2640
-1.30%
-0.85%
THAI
909.17
-0.76%
-4.37%
ARGENTINA
2325
-5.60%
-0.76%

Stock markets faced some correction in the initial day of the week after that Greek news that it would not received bail-out loan in this month. Few weeks ago I read that, time limit is mid October for Greece but now it rises to November.  But later markets recovered on the news of loans to banks by ECB and on the expectation that leader will ease the debt crisis. BoE will inject liquidity but some are trying to relate the problem with EU area. I think lower than expected GDP figure was really a problem for them and in coming future they may take more steps. Most of the reports from Euro-area were not good this week.


Metal Market

Look like Nymex Crude (Nov) is ready for another round of correction, it can only avoid that by breaking $90 level in the upside. Same is also true for Brent (Nov), for it the level is $114 in the upside. I said in past that I don’t like Natural Gas’s moves and it can correct more, this week it just proved that. Now it may move flat in coming days but if it tries to rise from here then it will be limited.
Gold was flat this week, I think it is taking some rest for another move. Gold will go up in future but before that it may correct little bit more, may be around $1500 level. Now Silver may test $30 level in the downside. Look like for both Gold and Silver, little more corrections are due. Copper is bouncing back from $3.00 level. I don’t know the reason behind this move but in coming days, it may fill the gap it created.



Stock market forecast for Coming week


Basically stock markets are in a position where by it is very hard to predict for sure that which way markets may go from here. But due to Fitch ratings in the initial day of the coming week, we may see some corrections.
As I said in last week DOW is moving in the same range of 10500-11200. The bearish pattern which I talked during few weeks showed some of it’s effect. That not means that market will rise from here, it may rise but for some strong move it needs to break 11800 level convincingly. Last day’s move was not good, if it drops then it may test 10800 level. I would like to see DOW to break that 10500-11200 range first. So the moves which is important, 11200-11800 in the upside and 10800-10500 in the downside.
I was expecting that DAX may test lower levels (5350) in the early days of the week, but it drops further. But as I said it was trying to test higher levels. I don’t like last day’s figure, unless it breaks 6000 level in the upside, it will be wrong to expect any big move, at least in the initial days of the coming week. Chart pattern says that there is a chance of going in higher levels (obviously if it breaks 5800 level.) but economic situations don’t permit that. On the downside if it breaks level around 5000, then it can drop more.
Brazilian BOVESPA’s move was not good, it is close to break crucial level of 50000. It may test 54000 level in the upside but chance of drop is more.
KLSE can go to test higher levels but it may test 1360 level before that. As I said in last week, that on the upside unless it breaks 1450, I don’t expect any new move from it.



Reports due in coming days

Wednesday, 12th October, 2011 –  FOMC minutes
Thursday, 13th October,2011 – Unemployment Claims, US Trade Deficit.
 Friday, 14th October 2011 –  Retail Sales, Consumer Sentiment.


I don’t want to go into the analysis of payroll reports, US needs more, these kind of reports. But question is how long these things can delay the recession ?  As we can see Goldman Sachs lowered global growth forecast.
No one knows for sure that what is going around. Now look like there is a matter that completely ends on Greece. If Greece defaults, then a recession will spread in different parts of the world, especially it can even drag down US. Now if anyone thinks about protecting himself by taking shelter in Emerging nations, they must remember that, their growth will also drop. 



NOTE :  Please see the disclaimer of this blog .


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