Financial markets are getting tensed towards the weekend

Original:	20110617	0300am
Last updated:	20110618	0430am

As financial markets are getting tense, I dedicate this post to audience who would like to follow up on timely events as published by Bloomberg, CNBC, Reuters, MarketWatch, etc. This post will be continuous (such that I need not post each updated event separately) and updated timely (under NO obligation.)

If you’re following equity market indices, bookmark this post and follow my timely updates (Singapore time)

·         After 1845pm for Asian (India closes around 630pm) market close,

·         After 1230am for Europe close and

·         After 0430am for US close. This would be the last update. 

This is a one-off post as the financial markets are getting tense. Original text, opinion and my speculation is posted in black while updates are in blue. The bonus is I would add post on commodities and currencies. 

As you probably know, the US stocks were down for six straight weeks last Friday. Would there be a seventh? The data shows where they closed last Friday and where it is today.

	Last Friday  close	Friday US close	Difference from last week closing	Potential shortfall % to achieve	Status
DJIA	11,951.91	12004.28	(52.37)	-	Closed Up
S&P	1,270.98	1271.50	(-0.52)	-	Closed Up
NASDAQ	2,643.73	2616.48	27.25	-	Closed down
	Last Friday  close	Friday Europe close
FCHI	3,805.09	3,823.74	(18.65)	-	Closed Up
GDAXI	7,069.90	7,164.05	(94.15)	-	Closed Up
FTSE	5,765.80	5,714.94	50.866	-	Closed down
	Last Friday  close	Friday Asia close
^SSEC	2,706.18	2,643.65	62.53	-	Closed down
^HS I	22,420.37	21,695.26	725.11	-	Closed down
^BSESN	18,268.54	17,870.53	398.01	-	Closed down
^N225	9,514.44	9,351.40	163.04	-	Closed down
^STI	3,078.35	3,005.28	73.07	-	Closed down

20110617 by Bloomberg: Asian Stocks Headed for Biggest Weekly Losing Streak in 7 Years on Greece Note my remarks in red.

The probability for the equity index to close the week on a positive note is the value it needs to close by. By looking at the (%) the probability could either be weak, possible or good. Anything could trigger bullishness or bearishness, thus we will need to see the tug-of-war between the bulls and the bears. By closing, we will know.

Asian closing. With the exception of ^KLSE, most Asian markets closed lower for the week. Malaysia is up 7.24 points or 0.47%.

20110618 Europe Closing. The major indices, DAX(Germany) and CAC40(France) Closed up for the week while FTSE UK closed another week lower. Europe, UK and US stocks rises on speculation of Greece plan and enthusiastic US leading economic indicator data. Though the speculation of a ‘new’ Greece plan brings hope, the predominant concern in my opinion is ‘still’ the ending of QE2.

20110618. US stocks closed mixed. The DOW and S&P ended up positive for the week breaking the 6 weeks down trend while the NASDAQ fell for the seventh week.

20110618 The CBOE Volatility Index rose for the week to 21.82. The US dollar index is at 75.04 at time of writing. 

Current global sentiments are

·         Europe debt crisis deepens; speculator bet of a Greece default. Everyone knows this. But, why wasn’t this event triggered much earlier but only recently? Now, coupled with weak (global) economic data, this is driving investor’s confidence much lower; sentiments lower. If you are investment savvy, you would know the answer. This is food for thought?

·         US recovery falters with weak economic data. (Latest: Weekly job benefit fell to 414,000 and Housing starts and Building permits came in better than expected – good for opening. The Philly Fed data came in at -7.7 which would be bad for closing)

·         Ending of QE2.

·         In Asia: Korea, China and India raise rates to curb inflation.

20110617 by Bloomberg Japanese stocks decline on concern Greek debt crisis is worsening by MarketWatch Asia weakens as Greece, U.S. concerns linger

20110618 Currencies: EUR/USD is up at 1.4312 (low 1.4128, high 1.4338) ahead of more at 1.4365/75 resistance. Euro gains on Sarkozy/Merkel talk. Euro’s bounding higher again as some hope may be in sight with emphasis on speed and some sort of solution to the Greek crisis by July at the latest. (Courtesy from Forex Live.) Europe stocks are above the flat line! Awaiting confirmation from other news provider.

20110618 Gold: Gold is up at US$ 1,537.77 (low US$ 1,522, high US$ 1,541.91). On the topside, gold will need to break the triangle top at $1547.50

20110618 Oil is down at US$ 92.70 (low US$ 92.15, high US$ 95.375) Oil continues to nurse steep losses. While other markets rallied on signs of progress in Greece, with the embattled prime minister sacrificing his finance minister to force through an unpopular austerity plan, Germany and France promised to go on funding Athens. But for many oil traders it was still a glass half empty. Oil's slump broke its inverse correlation with the dollar, which has eased to its weakest since mid-April at just 22 percent, based on the average of the past 25 days.

"The fear of the falloff from the Greek debt crisis continues to impact the oil markets. Indications of a possible resolution of the crisis have helped pare some of oil's losses but investors worry about the stalling pace of U.S. economic recovery," said McGillian, analyst at Tradition Energy. (Courtesy of Reuters.) Here, I just want to highlight that not all investors’ mindset and interpretation of an ‘event’ moves with the same alignment.

In conclusion, slow global growth concerns and Greece are supporting the bears. There had not been a string of good news lately. Let’s hope that the US consumer sentiment data, leading indicators and quadruple witching may catalyst to prop up any bullish sentiment on Friday. Else, investors would sell lower before the week close. I can’t imagine what the headlines would be over the weekend.

20110617 by CNBC Friday look ahead: Greece, Quadruple Witch and Consumer data, Leading indicators are equally important! What Happens If Greece Defaults?

Meanwhile, I am confident your insurance agents or financial consultants are as competent, advising you the best strategy there is. A word of caution - be cautious if ‘some’ were to advise – ‘buy more’ because it is cheap; it is long term, market will go up later. That is true but if you had heard of this since early May, you would have suffered losses now (say 5%) and might need the market to recover ‘more’ (say 6%) just to break even.

I’ll sign off here, have a great weekend. Watch my next blog for the weekly summary before Monday, Jun 20^th.  

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