From worst Eve to best day in a decade

27 December, 2018

Santa arrived a little later than expected this year. At one point investors thought Santa would never show up with markets in red and bears not letting go. Suddenly, U.S. stocks began showing signs of life again after falling briefly into bear market territory on Wednesday. The S&P 500 gained 4.96% led by a most beaten Tech sector, the Dow Jones Industrial Average rallied 1,086 points notching its largest one-day point gain in history, and the NASDAQ Composite ended the day 5.84% higher.

Markets have been starving for some positive news after market commentary had been mainly focused on global economic slowdown and recession fears. They finally received that good news. U.S. Holiday sales in 2018 rose 5.1% according to Mastercard, the strongest growth in six years. This was a clear indication that consumer confidence remains high despite the recent plunge in equity markets. Other factors that helped restore investor confidence was a comment from the White House assuring that the Federal Reserve Chairman wouldn’t be fired and a report issued before the market closed stating that a U.S. delegation will visit Beijing early next year to revive trade talks. Given that markets were in extremely oversold territory, technical factors helped amplify Wednesday’s gains. 

While yesterday’s price action is definitely a positive sign, it’s still too early to conclude whether the market correction is over or more downside is yet to come. Such rallies are not uncommon in troubled times, and we have experienced many of them in past bear markets. To call for a bottom, we need at least a couple of days of strength, not just in price, but also in trading volume, breadth of the market, and fundamentally supported environment. So far, we don’t see a shift in fundamentals. Trade tensions between the U.S. and China remain the biggest unknown factor for 2019.  U.S. politics and government shutdown also requires caution. Many global leading economic indicators such as PMI’s were pointing south in recent months. Until we see a shift in fundamentals, it’s challenging to build on a single day rally.


Source link  
Equities higher as China GDP slows

Investor appetite to risk remains on the rise today, with equities in green across Asian markets. The slowdown in China's economy will not impact...

How did Powell upset the markets?

Equity investors didn't like what they heard from Fed Chair Jerome Powell on Wednesday. After trading more than 350 points higher intraday, the Dow...

Equity investors doubting trade truce

The relief rally led by the US-China trade war truce didn't last long. Investors in Asia were seen taking profits from Monday's bounce in equities...


Global markets surge on trade truce hopes

Optimism over the temporary trade truce announced between the United States and China after the G-20 summit in Argentina last weekend has played...

Fed commitment supports Greenback

Reinforced expectations over higher interest rates in the United States after the Federal Reserve provided a consistent narrative that policymakers...

Rupiah manages to withstand Dollar drive

Improved risk appetite and an improved attitude towards global stock markets have helped support a number of different APAC EM currencies...


Equity sell-off resumes in Asia

The steep sell-off in U.S. equity markets suggests October could be the worst month since the global financial crisis of 2008. Seven trillion...

Sea of red across global equity markets

October has been a terrible month for equity investors so far. The S&P 500 and Dow Jones Industrial Average fell into negative territory for the year...

Italian budget, ECB meeting, US GDP

Asian shares were mostly higher this morning as Chinese indexes rallied more than 4% on verbal support from the country's top officials. Although the positive...


In the past 24 hours Bitcoin has lost -0.19% and reached $3599.17406438. Open your trading account with the best cryptocurrency brokers on special terms today.

In the past 7 days the EUR/USD pair has gained 1.5351% and is now at $1.1563. Start trading and making money on Forex today.

In the past 7 days Ethereum has lost -4.83% and is now at $118.130634428. Have the most popular cryptocurrencies compared online 24/7.


Top Brokers offering Daily Forex Market Reviews


Forex Currencies Forecasts


Top 10 Forex Brokers 2019

# Broker Review
1easyMarketseasyMarkets91%
2FXTMFXTM87%
3HYCMHYCM86%
4FxProFxPro84%
5FIBO GroupFIBO Group83%
6OctaFXOctaFX82%
7HotForexHotForex81%
8FXCMFXCM80%
9XMXM72%
10FP MarketsFP Markets69%
  


Share: