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Stock markets continue to rally

In stock markets, JPN225 (Nikkei) closed up by 2.55%, its highest since March 5. The Hang Seng and the Shanghai Composite index also rallied, the former by over 2% and the latter by about 1%.

USA500 futures were showing a 1.8% gain, as of the early London AM session, pointing to a solid opening on Wall Street. Ongoing news of economic reopening around the world, along with cheap money, have Fed the risk-on theme, which is offsetting the rising tensions between the US and China. Hopes for a rapid development of a vaccine for the coronavirus is also in the mix, as the US firm Novavax said it has begun enrolling participants in the first human study of its vaccine, which Oxford University is now already weeks into human tests, and say its vaccine could be ready as soon as September. Also, Japan has given up on hopes of approving coronavirus treatment Avigan by end May, a COVID-19 drug being developed by Fujifilm. According to PM Abem the drug could be approved by the end of May if  its safety and effectiveness could be confirmed.

Hence as risk appetite remains supported by the gradual reopening of key economies and the falling number of new Covid-19 cases in advanced economies, the concern over Hong Kong protests also continued to recede and lingering US-China tensions are pushed aside , although clearly they still have the potential to disrupt the economy once again.

As risk appetite continued to strengthen, stock market valuations are climbed further during the European session, with USA500 extending northwards after breaking 3-month peak and the round $3,000 level. After failing to break $ 2,975, three times in a row during April and May, yesterday’s close above it and today’s move further higher presents an increasing fight from bulls. The upwards bias looks to be sustained so far today, with the price action posting higher highs and higher lows intraday and momentum indicators positively configured. MACD moved further above zero line and signal line, RSI has flattened into OB zone around 70s, while fast Stochastics turned lower posting a bullish cross, suggesting that correction/consolidation might be seen in the next few hours however the overall sentiment for today is held strongly positive. The focus on the upside is on double top area back in February-March , which coincides with 76.4% Fib. levek, at $3,100. On the flipside, only a turn below $2,975 (close to PP and 2-month Resistance ) could signal a potential reversal to the downside in the short term. In the medium term Support could be seen at 20-day SMA ( $2,906).

In Europe meanwhile, stock markets continue to rally as well, with the UK100 outperforming in catch up trade and up 1.8%. The GER30 has added a further 0.7% to the more than 2% gain yesterday and IBEX and MIB are outperforming as are peripheral bond markets amid a general rise in risk appetite and of course Villeroy’s dovish comments from yesterday, which seemed to open the door to an abolition of the capital key restrictions in the PEPP program, although that would likely spark additional legal challenges. For now though it is adding to the narrowing of spreads, with the German 10-year yield up 5.1 bp at -0.447%, the Italian 10-year down -5.1 bp at 1.52%. The UK 10-year rate meanwhile is up 1.2 bp at 0.18% and U.S. rates have lifted 3.4 bp to 0.69%.

Click here to access the HotForex Economic Calendar

Andria Pichidi

Market Analyst

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Stock markets continue to rally published first on https://alphaex-capital.blogspot.com/

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Markets Tumble as Big Fed Move Fails to Quell Virus Fears

Markets reeled on Monday, with stocks on Wall Street and the price of Brent crude tumbling more than 10%, as the Federal Reserve’s second emergency rate cut in as many weeks failed to calm fears of a coronavirus-induced recession.

Volatility gauges known as fear indexes spiked, with the Euro STOXX 50 in Europe surging almost 28% to an all-time high and the CBOE Market Volatility index soaring more than 30% as stocks plunged further into bear territory.

Even traditional safe havens cratered as fearful investors said that cash is king.

Platinum dived nearly 27% to its weakest level since 2002, while gold fell more than 5% as investors unloaded precious metals in exchange for cash as not enough buyers sparked illiquidity, especially in the U.S. Treasury market.

The S&P 500 plunged 8% shortly after the open to trigger an automatic 15-minute halt in trading on the three main U.S. stock indexes. The halt was the third emergency pause on Wall Street in six days, and U.S. stocks resumed their decline after trading resumed.

Investors worried that the Fed action, joined by central banks in Japan, Australia, New Zealand and elsewhere, may be insufficient for companies facing a sharp slide in demand. The moves were reminiscent of the sweeping steps taken more than a decade ago to staunch a meltdown of the global financial system.

Lower rates and increased asset purchases by the Fed will help ease tight credit markets, but the U.S. government needs to do more to address the impact of the coronavirus, said David Joy, chief market strategist at Ameriprise Financial in Boston.

“The Fed did what it could; I’m not so quick to blame the Fed,” Joy said. “Investors are looking around hoping, praying, that there will be a big fiscal package yet to come from Washington – but getting nervous that it might not.”

Rate-sensitive U.S. financial stocks plunged -12.8%, leading declines among the major S&P sectors. Energy stocks tracked a 10% slump in oil prices, while technology stocks also slid -11.9%. Apple Inc, Amazon.com Inc and Microsoft Corp together lost nearly $300 billion in market value.

MSCI’s gauge of stocks across the globe shed 8.41% and the pan-European STOXX 600 index lost 4.86% as stock markets pared initial deeper losses in Europe. Marketsin France and Spain led the decline as the two countries joined Italy in enforcing a national lockdown.

The benchmark European index has now lost more than a third of its value since hitting a record high in mid-February, while the benchmark S&P 500 and Nasdaq composite are down about 27%.

On Wall Street, the Dow Jones Industrial Average fell 2,701.75 points, or 11.65%, to 20,483.87. The S&P 500 lost 293.13 points, or 10.81%, to 2,417.89 and the Nasdaq Composite dropped 848.15 points, or 10.77%, to 7,026.72.

Almost nothing was left unscathed. Oil, already slammed by a Saudi-instigated price war, slid to less than $30 a barrel to lows last seen in early 2016.

Oil futures for West Texas Intermediate, the U.S. benchmark, fell $3.03 to settle at $28.70 a barrel, while Brent crude futures fell $3.80 to settle at $30.05 a barrel.

There were moves in Europe to curb short-selling of stocks as bond markets weighed the risk to vulnerable countries, as well as the impact of a fiscal spending splurge on safe-haven debt.

Benchmark 10-year Treasury notes last rose 74/32 in price to yield 0.7198%.

The Fed’s emergency 100 basis-point rate cut on Sunday was matched by the renewal of its quantitative easing program to increase cash in markets and more cheap U.S. dollar funding to ease a ruinous logjam in global lending markets.

There was further policy easing on Monday from the Bank of Japan in the form of a pledge to ramp up purchases of exchange-traded funds and other risky assets.

New Zealand’s central bank cut rates 75 basis points to 0.25%, while the Reserve Bank of Australia pumped more money into its financial system. South Korea and Kuwait both lowered rates, while Russia and Germany were throwing together multi-billion dollar anti-crisis funds.

MSCI’s index of Asia-Pacific shares outside Japan tumbled 5.2% to lows not seen since early 2017, while the Nikkei fell 2.5% as the BoJ’s easing steps failed to reassure markets.

U.S. and Chinese data underscored just how much economic damage the disease can cause, with official numbers in China showing the worst drops in activity on record. Industrial output plunged 13.5% and retail sales 20.5%.

Manufacturing activity in New York state also plunged in March by the most on record to its lowest level since 2009, offering an early glimpse of the coronavirus’ damaging impact on the U.S. economy.

In Asia, Shanghai blue chips fell 4.3% overnight even as China’s central bank surprised with a fresh round of liquidity injections to the financial system. Hong Kong’s Hang Seng index tumbled 4%.

Wall Street’s worries deepened after New York and Los Angeles both ordered bars, restaurants, theaters and cinemas to shut to combat the spread of the coronavirus, mirroring similar measures in Asia and Europe.

Markets have been severely strained as bankers, companies and individual investors stampede into cash and safe-haven assets while selling profitable positions to raise money to cover losses in savaged equities.

The safe-haven Japanese yen jumped as concerns about the outbreak sent investors fleeing higher-risk assets.

The dollar index rose 0.155%, with the euro up 0.56% to $1.1167.

The Japanese yen strengthened 1.94% versus the greenback at 105.89 per dollar.

U.S. gold futures settled 2% lower at $1,486.5 an ounce.

Graphic – World stocks plunge on virus worries: https://ift.tt/2TVZvu5

(Reporting by Herbert Lash, additional reporting by Marc Jones in London, Wayne Cole in Sydney; Editing by Dan Grebler)

from IJR https://ift.tt/38X6ffv via IFTTT

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New Post has been published on https://www.stl.news/us-stocks-swing-back-gains-dow-330-turbulent-day/83794/

US stocks swing back to gains, Dow up 330 on turbulent day,

/February 9, 2018 (AP)(STL.News) —

A late-afternoon rally reversed steep losses for U.S. stocks Friday, lifting the Dow Jones industrial average more than 300 points and capping a turbulent week on Wall Street that left the market with its steepest weekly slide in two years.

The big point swings that pummeled stocks reflected a return of volatility after an unprecedented period of calm. Until this week, the market had not endured a 5 percent drop since January 2016.

“There’s a fair amount of volatility in the market, and our belief is the volatility is leaving investors riddled with stress and uncertainty, which is likely to continue,” said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management.

The swiftness of the market’s slide into a correction, or a drop of at least 10 percent from a recent peak, was unparalleled. The Standard & Poor’s 500 index, the benchmark for many index funds, took only nine days to fall 10 percent from its all-time high on Jan. 26.

“The S&P 500 hasn’t moved into correction mode this quickly, ever,” said Lindsey Bell, investment strategist at CFRA Research.

Since hitting that high last month, the S&P 500 has lost about $2.49 trillion.

For a while Friday, it was anybody’s guess whether the weeklong sell-off would ease or worsen. Stocks struggled to stabilize much of the day as investors sent prices climbing, then slumping in unsteady trading a day after the market entered its first correction in two years.

The Dow Jones briefly sank 500 points after surging more than 349 points earlier in the day and then swung to a 330-point gain in the final hour of trading. The blue chip average suffered its second 1,000-point drop in a week on Thursday.

At one point, the market was on pace for its worst weekly decline since October 2008, at the height of the financial crisis.

“History does show that, even though we haven’t seen this quick of a movement from a peak to correction mode, what we do know is the swifter the way down, the sooner the market will bottom and start moving up,” Bell said.

All told, the S&P 500 rose 38.55 points, or 1.5 percent, to 2,619.55 Friday. The Dow gained 330.44 points, or 1.4 percent, to 24,190.90. The Nasdaq composite added 97.33 points, or 1.4 percent, to 6,874.49.

The three indexes finished the week down more than 5 percent. They’re also now all in the red for the year.

Technology companies accounted for most of the broad gains, outweighing losses in energy stocks, which slumped as U.S. crude prices declined. The price of oil fell below $60 a barrel for the first time this year.

Bond prices also fell. The yield on the 10-year Treasury rose to 2.86 percent from 2.83 percent late Thursday.

U.S. stocks started to tumble last week after the Labor Department said workers’ wages grew at a fast rate in January. Investors worried that rising wages will hurt corporate profits and could signal an increase in inflation that could prompt the Federal Reserve to raise interest rates at a faster pace, putting a brake on the economy.

Also contributing to the big swings this week was the blow-up of exchange-traded products that were built to profit if markets remained calm. Once volatility spiked, it led to huge losses for the investments, which may have exacerbated the market’s swings. Other automated trading programs, which sell stocks when volatility rises, may have also contributed, among others.

The market, currently in its second-longest bull run of all time, had not seen a correction for two years, an unusually long time. Many market watchers have been predicting a pullback, saying stock prices have become too expensive relative to company earnings.

Not only are corrections common during bull markets, they’re seen as entirely normal and even healthy. They allow markets to remove speculative froth after a big run-up and allow investors to buy stocks at more reasonable prices.

Analysts warned that stocks had become too expensive. As of Jan. 26, the S&P 500 traded at 18.6 times its expected earnings — a popular measure of stocks’ value — compared with a median level of 15.2 since 2000. The measure dropped to 16.4 as of Thursday, meaning stocks were less expensive but still not cheap.

The prospect of ballooning deficits also stoked jitters among investors this week after Congress agreed to a $400 billion budget deal just weeks after voting to slash taxes.

Rising deficits could drive interest rates higher. That’s because growing deficits force the U.S. Treasury to issue more bonds, and investors are likely to demand higher rates before buying them.

The market’s reversal came just as Jerome Powell took over as Federal Reserve Chairman.

The central bank may have to more aggressively raise short-term rates to offset the economic stimulus from higher government spending and lower taxes, which also unnerves investors.

The economy is already running hot, with the nation’s unemployment rate at a 17-year low of 4.1 percent. The extra stimulus threatens to send inflation higher.

Even so, Wall Street analysts note that the outlook for corporate America and the broader global economy remains positive. Major economies around the world are growing in tandem for the first time since the Great Recession, and corporate profits are on the rise. The housing industry is solid, and manufacturing is rebounding.

“By many metrics, the earnings picture looks good, and higher earnings provide the basis for valuation support and, I think, still higher stock prices if you look toward the end of the year,” Sandven said.

Benchmark U.S. crude lost $1.95, or 3.2 percent, to settle at $59.20 per barrel on the New York Mercantile Exchange. Oil has not been below $60 a barrel since Dec. 28. Brent crude, used to price international oils, slid $2.02, or 3.1 percent, to close at $62.79 in London.

In other energy futures trading, wholesale gasoline fell 7 cents to $1.70 a gallon. Heating oil shed 7 cents to $1.86 a gallon. Natural gas fell 11 cents, or 4.2 percent, to $2.58 per 1,000 cubic feet.

The price of gold declined $3.30, or 0.3 percent, to $1,315.70 an ounce. Silver lost 20 cents, or 1.2 percent, to $16.14 an ounce. Copper fell 5 cents to $3.03 a pound.

The dollar fell to 108.53 yen from Thursday’s 108.84 yen. The euro dipped to $1.2231 from $1.2263.

The turbulence in U.S. stock indexes followed a broad slide in global markets.

In Europe, Germany’s DAX fell 1.2 percent, while France’s CAC 40 lost 1.4 percent. Britain’s FTSE 100 shed 1.1 percent. Asian markets fell more sharply. Tokyo’s Nikkei 225 lost 2.3 percent and Hong Kong’s Hang Seng gave up 3.1 percent.

___.

By ALEX VEIGA, AP Business Writer, By Associated Press – published on STL.News by St. Louis Media, LLC (A.S)

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Remembering renowned lyricist Indeevar, on his 20th death anniversary. The man who penned the title track for the Rajesh Khanna – Sharmila Tagor hit, ‘Safar’, ‘Zindagi ka safar, Hai yeh kaisa safar Koi samjha nahi … Koi jaana nahi …’ is Indeevar. Unluckily enough, Indeevar didn’t get many opportunities like this to pen down these quality songs. His career span is spread over four decades with a quantum of chartbusters only. The very reason could be his compromise on quality on work for his survival in this Indian Music Industry. Born in Jhansi, Madhya Pradesh as Shyamalal Bahu Rai, he came to the city of dreams, Mumbai with the clear intention of being a lyricist. He got his first assignment for the movie called ‘Double Face’ (1946). To be in the business, he took every assignments and grabbed every film that came his way and didn’t mind working for ‘B’ and ‘C’ grade projects. He got his first big break in the form of ‘Malhaar’ (1951). ‘Bade Armaan Se Rakha Hai Balam Teri Kasam’, a popular composition that retains a refreshing feel even today. But even this song couldn't ensure instant success. He finally shot into the big league with Babubhai Mistry's musical extravaganza, Parasmani (1963), which also launched the career of music duo Laxmikant-Pyarelal. In subsequent years, Indeevar forged a strong bond with a select set of filmmakers and music directors, that resulted in a repertoire of music that was eminently hummable, subtly evocative and definitely unforgettable. Though he got his first break in Justice Choudhury (1946) - he did another film of that name in 1983 - he did not get credit for the song, because by prior arrangement it went to top name Dinanath Madhok. Later he wrote songs like Kaise koi jiye (Baghban) and Aanewale kal ki tum tasveer ho (Chhote Babu), but recognition came only with Roshan s and Mukesh s Malhar with brilliant songs like Tara toote duniya dekhe , Bade armaanon se rakkha hai , Ek baar agar tu keh de and Hota rahaa yun hi gar anjaam wafaa ka . This also helped him being established as a regular lyricist as till then it was only assumed that he could excel in patriotic songs. The learned lyricist however hit big-time only after his association with Kalyanji-Anandji began around the early 60s. But from then on Indeevar never looked back all the way till his death in 1997, tuning with composers from Roshan in the 40s to Viju Shah, Aadesh Shrivastava, Anand Raaj Anand and Jatin-Lalit in the 90s. The only composer with whom I never worked somehow was S.D.Burman. I even recorded a song with Naushad for B.R.Chopra s Chanakya Aur Chandragupta, because Sahir Ludhianvi insisted that I do the film! said the poet. And this honour came to Indeevar because Sahir had called upon him to check the Hindu veracity of the former s lyrics in Chitralekha. I told Sahir that they were perfect! recalled Indeevar. Indeevar s deshbhakti genre did not find much representation in Hindi cinema. Songs like Dulhan chali and Hai preet jahaan ki reet sadaa were used - with necessary modifications over 20 years after he penned them as poems - in Manoj Kumar s Purab Aur Paschim. But there were two kinds of songs that he was best associated with - the intensely passionate passages on beauty and the songs that were loaded with truisms on life. There was a third kind too - the chaalu stuff that he did mainly for Bappi Lahiri s southern films in the 80s, but Indeevar was very clear about them as well. These songs were naughty, not cheap or vulgar. Often the way they were filmed made them seem that way. What shocked most people was that Indeevar could write such stuff. But a good lyricist must be an all-rounder. And I was getting good money to be one! Yes, Indeevar-ji had his idiosyncrasies and over a period of years we learnt how to use them well! For example, he tended to be a bit slow at work, so we wanted a title-song for Safar quickly we goaded him by saying that since he took a month to write a good song we had told the director to get someone else. He was immediately uptight and demanded to know the situation. We told him that it was about how no one understood the meaning of life, and that the mukhda had to include the word Safar or journey, because it was the title of that film. Within 30 minutes, the lyrics and tune of Zindagi ka safar hai yeh kaisa safar was ready and approved! He had his humorous, child-like side too. He wanted to go with us once to London, and we told him that it was pointless for him because he could not even tolerate hill-tation climates. But so determined was he that he installed an airconditioner in his home in the intervening weeks. When he came to the airport in humid July he was already wearing an overcoat and a wig, because someone had also told him that being bald would not look good in Britain! In the flight he kept laughing loudly and when asked why, he stated that according to Freud one must laugh when one is scared! Lyricists tend to have favourite words and phrases and Indeevar-ji s favourite word was kya , but he used this word with innumerable variations, as in Kasme vaade pyar wafa sab baatein hain baaton ka kya , Kya khoob lagti ho , Ek tu na mila saari duniya mili bhi to kya hai and many others. One of his most creative and fruitful alliances was with Manoj Kumar, who first signed him on for Upkar (1967). Indeevar and Kalyanji-Anandji injected the film with a fine blend of soulful emotion and patriotic euphoria through songs like ‘Kasme Vaade Pyaar Wafa’. Equally powerful were compositions like ‘Dulhan Chali, O Pehen Chali’ and ‘Koi Jab Tumhara Hriday Tod De’ from Purab Aur Paschim (1970). Earlier, in 1968, he had culled an awesome collection of soulful lyrics for Govind Saraiya's Saraswati Chandra. Together with his long-standing partners, Kalyanji-Anandji he produced unforgettable numbers such as ‘Chhod De Saari Duniya Kisi Ke Liye’, ‘Chandan Sa Badan’ and ‘Main To Bhool Chali Babul Ka Des’. In direct contrast to this classic score, the trio set an upbeat mood for Vijay Anand's musical hit, Johny Mera Naam (1970) with zany songs like ‘Nafrat Karne Walon Ke’ and ‘Pal Bhar Ke Liye Koi Hame Pyaar Kar Le’ and ‘O, O Mere Raja’. Two of Indeevar's best-remembered films were made the same year. While Manmohan Desai's Sachcha Jhootha produced ‘Meri Pyaari Beheniya Banegi Dulhaniya’, which has since become a permanent fixture in every wedding band, Asit Sen's Safar had Indeevar's poetic juices churning out wonders like ‘Jeevan Se Bhari Teri Aankhen’ and ‘Jo Tumko Ho Pasand’. Throughout the 1970s, his winning combination with Kalyanji-Anandji grew stronger and continued all the way up to Qurbani's' (1980) ‘Hum Tumhe Chaahte Hain Aise’. With the arrival of the disco beat and the Bhappi Lahiri wave, Indeevar put poetry on the backburner and stood up to the task of delivering mindless lyrics. There was a preset combination for all these Southern-style 'pots-n-pans' hits: Jeetendra, Sridevi, Jaya Pradha, Bhappi Lahiri and Indeevar. All the way from Himmatwalas' (1983) ‘Nainon Mein Sapna’ to Tohfa's nonsensical title song, Indeevar willfully accepted and adapted to the changing trends in film music. Towards the end of his career, he notched up a few hits with actor-turned-filmmaker Rakesh Roshan such as Karan Arjun (1995) and Koyla (1997). But even as he was trying to redeem himself as a poet, Indeevar passed away on February 27, 1997.

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