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Stock market review (weekly) after 17th February, 2012.


Moody’s downgrade did not able to create panic because that was overcome by Chinese support news and hopes that are building surrounding Greece. Japanese stimulus and better US data also supported the markets.

INDEX
17th Feb, 2012
2/10/2011-2/17/2012 (%)
2/03/2011-2/10/2012 (%)




Dow
12949
1.16
-0.47
Ftse
5905.07
0.9
-0.82
Cac
3439.62
1.97
-1.59
Dax
6848.03
2.32
-1.09
Australia S&P
4195.9
-1.16
-0.14
Shanghai Com.
2357.18
0.22
0.93
Hang Seng
21491.62
3.41
0.13
Sensex
18289.35
3.05
0.82
Russia :Titans
6492.92
2.84
-3.96
Bovespa
66203.5
3.45
-1.87
Argentina: Merval
2798.83
2.83
-3.16
South Africa
34082.78
0.56
-1.44

Some of the Emerging nations are seeing 6th consecutive positive weeks, where as Australia is facing 3 consecutive negative weeks. I was reading somewhere about loans (local governments) those are due for repayment in China, as some experts are suggesting that they are not in a good condition to repay those. Their January home prices recorded worst performance in a year.




Stock market forecast for coming week.

Emerging markets have seen much inflows of money in this year so that is a good sign for overall world financial market. Now sentiment is improving as investors are taking more risk. In coming days markets will react according to the outcome from Greece. Many stock indexes are showing that they can go more in coming days, but there are lots of investors who are just praying for a correction to enter into the market.

DOW was flat in the early days but later in the week due to good reports and hopes from Greek, it was trying to test 13000 level which I said in last week. Last day’s volume says that it can go more in the upside but for that it has to break this 13000 level convincingly. Some technical indicators support that up move. But somehow if it reverse its course then it will get support at 12600 and then at 12300.
Like DOW, DAX is also trying to test higher levels. As technical indicators are saying, I think DAX may test 7000 level if good news comes from Greece. In last day it has created a gap, so I will be watching it in coming days. If it reverse then it will get initial support around 6450 and then at 6100.
I was expecting that BOVESPA may test 63000 level but it bounce back from 64000 level. I think in spite of short-term overbought condition it may follow the global trend and may test 68000 levels in the upside. In the downside if it breaks 63000 then it can go below 60000.
I was expecting Shanghai Composite to test 2400 level but it did less, right now it is getting resistance at 2370 but it can break that on positive news. On the other hand last two days closing figures were not good, it has a support at 2300.
During last few weeks I told many times that any good news can take Strait TIMES into higher levels. It may not hear sound but I still think that it can go more in the upside may be above 3100, as its bullish pattern says. But if it reverse its course then it may get support at 2900 and then below 2800.



Reports due in coming days (from US)

Wednesday, 22nd February, 2012 – Existing Home Sales

Thursday, 23rd February, 2012 – Unemployment Claims, FHFA Home Price Index.

Friday, 17th February, 2012 – Consumer Sentiment, New Home Sales.

So couple of year's euro-zone fear is leaving us!  I think only rating agencies (Who is going to downgrade these Rating Agencies for life - blog*spot), some experts and Medias have that answer. What I think that Greek may get temporary solution of their debt which will be due in coming month. But what after that! What about Portugal, Spain and Italy!  One thing is sure if Greece gets the bail-out money then we may see its reaction on the stock markets around the world, some of which are already in short-term over-bought condition.



NOTE:  Please see the disclaimer of this blog.

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