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Stocks Rebound But Fears Remain

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STATE OF THE MARKETS

Stocks rebound but fears remain. US stocks rebound on Thursday after reports of improved employment sectors with less unemployment claims. Dow (+0.55%), Nasdaq (+1.77%), S&P (+1.06%) including Russell (+0.64%) edged higher but light volume was noted amid fears of rising inflation (costs), new tax structure and interest rates.  The news saw bond demand return, sending 5Y (0.82%), 10Y (1.63%) and 30Y (2.34%) yields lower.

Crude futures continue to close lower for the third day in a row, below $62.10/bl, after reports of progress in the Iran nuclear deal. Reduced economic activities in Asia due to renewed lockdown, aggravate the selling pressure. Gold however, returned with firm bid as inflation worries continue to plague markets. The yellow metal settled higher, above $1,876.60/oz, as New York closed.

In the FX space, the remaining fears were confirmed after Swiss seized the helm of demand for short term accounts, while remained firm in the medium to long terms as Yen eases across the boards. Short term accounts also saw firmed bids on Aussie and Loonie, while long and medium terms still running on the back foot. Euro and Sterling remained in a tug of war as sentiments stalled.


G8 CURRENCIES SENTIMENTS

ST CHF AUD CAD GBP EUR JPY NZD USD ST
MT EUR GBP CHF CAD JPY AUD NZD USD MT
LT CAD CHF GBP EUR AUD NZD USD JPY LT
** ST refers to Short-Term daily turnover, MT is Medium Term weekly 
and LT refers to Long-Term monthly turnover.

WALL ST MOST ACTIVE

TICKER LAST PRICE

% CHANGE

VOLUME 90 DAYS AVG
F 12.49 + 3.14 106,243.9K 75,353.0K
SPCE 19.81 + 14.71 93,183.0K 16,858.9K
UVXY 4.49 – 8.18 91,472.2K 92,736.4K
SQQQ 11.62 – 5.83 83,221.3K 89,664.2K
T 29.64 + 2.35 81,940.2K 45,617.8K
UONE 9.56 + 59.07 82,053.8K 985.7K
SPY 415.28 + 1.08 78,022.2K 80,604.2K
AAPL 127.31 + 2.10 76,857.1K 102,256.4K
AMC 12.55 – 0.71 61,419.7K 141,653.2K
PRPO 4.75 + 14.77 55,223.1K 9,318.2K
** % Change here refer to price

WALL ST TOP FLOWS

TICKER LAST PRICE

VOLUME

% CHANGE FUNDS FLOW $
TSLA 586.78 30,821.1K – 3.62 18,085.2M
AAPL 127.31 76,857.1K – 17.15 9,784.7M
AMZN 3,247.68 2,633.1K – 41.06 8,551.5M
FB 318.61 17,320.2K – 19.54 5,518.4M
MSFT 246.48 21,800.7K – 22.74 5,373.4M
NVDA 584.50 8,039.7K + 29.42 4,699.2M
BABA 216.99 19,123.4K + 16.89 4,149.6M
AMD 78.06 49,135.0K – 5.56 3,835.5M
GOOGL 2,306.95 1,617.5K – 7.97 3,731.5M
GOOG 2,356.06 1,191.5K – 18.00 2,807.3M
** % change here refers to volume

TOP 5 BLOCK ORDERS

SYMBOL PRICE / STRIKE TYPE VOL/OI FUNDS FLOW $
BHC 31.55 / 31.00 stock options/put 109.36 135.8M
GPS 32.58 / 32.50 stock options/call 69.89 324.0M
AMD 78.06 / 77.50 stock options/call 60.04 3,835.5M
ZN 132.1500 US bond futures 8,400 111,006.0M
CL 56.54 – 62.95 crude oil futures 4,750 287.8M

OUR PICK – No New Picks

No new picks going into the weekend. Stocks rebound today is somewhat expected as short term technical traders bid the markets, but the rally still does not convince us of another leg higher as Dow bulls still need to overtake 34,500 while S&P at 4,185 points. Even then, there is still a challenge to defeat the monthly top. If our calculations are correct and depend on where markets are going to close for the week; then Nasdaq might still see another rally next week before another bumpy ride as long term investors continue to take profits off the table. The last three weeks fall in the tech laden Nasdaq, saw heavy bidding in defensive sectors and low beta stocks which signaled that long term investors are preparing for the worst. Continuous net outflows of equities and higher inflows to short term money markets for the past five weeks confirmed this thesis.

Trades updates:  We remain bullish PFE and will continue to accumulate on dip, NZD/USD stop updated to break even while we continue to see medium term weakness in MO and Crude.

HORIZON STRATEGY SL TP1 TP2
Short-Term
Medium-Term
Long-Term

 

Disclaimer:

This article is for general information purpose only. It is not an investment advice or a solicitation to buy or sell any securities. Opinions expressed are of the authors and not necessarily of MFM Securities Limited or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.