DOW JONES, STRAITS TIMES INDEX OUTLOOK:

  • Dow climbed on bettering US information, shrugging off election safety considerations
  • 30 out of 34 S&P 500 firms delivered constructive earnings shock on Thursday
  • Singapore’s Straits Occasions Index (STI) might edge larger on opening-up hopes

Dow Jones Index Outlook:

Wall Road equities shrugged off earlier shocks on election safety investigations and closed 0.5% larger on Thursday. Higher-than-expected jobs and housing information helped elevate optimism about an financial restoration. In the meantime, the continuing fiscal stimulus talks stay in focus, nevertheless, the chance {that a} invoice could possibly be handed earlier than the US election seems to be skinny with out a blessing from the Senate.

The US present houses gross sales registered 6.54ok in September, marking its highest studying seen since 2006. On a month-on-month foundation, it grew by 9.36% (chart beneath). Stronger housing information might elevate sentiment within the constructing supplies, monetary and building sectors.

Dow Jones Underpinned by Jobs and Housing Data, Final Debate in Focus

Supply: Bloomberg, DailyFX

The weekly US jobless claims got here in at 811ok, registering its lowest studying for the reason that Covid-19 outbreak. Earlier month’s determine was revised decrease to 866ok from 898ok, underpinning the resilience of the roles market.

Asia-Pacific markets appear to commerce in combined sentiment in early hours, with the haven-linked US Greenback and Japanese Yen climbing whereas the risk-linked Australian Greenback and Norwegian Krone erasing earlier features. The Nikkei 225 index opened marginally larger. The Australian market is closed for a vacation.

Dow Jones Underpinned by Jobs and Housing Data, Final Debate in Focus

Supply: Bloomberg, DailyFX

Equities Forecast

Equities Forecast

Really helpful by Margaret Yang, CFA

What’s the street forward for equities this quarter?

US company earnings continued to be upbeat. On Thursday, 30 out of 34 main US firms launched better-than-expected outcomes (desk beneath). Up to now within the earnings season, greater than 80% of the S&P 500 constituents have crushed their EPS forecasts.

On the political entrance, merchants are eyeing the ultimate presidential debate between Joe Biden and Donald Trump to be held at 9am native Singapore time on Friday. Markets appeared to have closely priced in a Biden-win situation, rendering them fragile to unwinding actions ought to the election consequence flip towards expectations.

Sector-wise, 6 out of 9 Dow Jones sectors closed within the inexperienced, with 73% of the index’s constituents ending larger yesterday. Power (+3.57%) had an honest rebound in a single day as crude oil costs climbed. Financials (+1.99%), industrials (+1.93%) and communication companies (+0.82%) have been additionally among the many prime performers, whereas data know-how (-0.52%) and client staples -0.49%) have beenlagging.

Dow Jones Index Sector Efficiency 22-10-2020

Dow Jones Underpinned by Jobs and Housing Data, Final Debate in Focus

Supply: Bloomberg, DailyFX

Forex for Beginners

Forex for Beginners

Really helpful by Margaret Yang, CFA

Why do rates of interest matter for currencies?

Technically, the Dow Jones index entered a consolidative interval since mid-October and its near-term pattern seems to be bearish-biased (chart beneath). It has examined a direct help degree at 28,040 and has since rebounded. 28,040 can be the 38.2% Fibonacci retracement as drawn on the chart beneath. A direct resistance degree may be discovered at 28,390 – the 23.6% Fibonacci retracement. Breaking above 28,390 might open room for extra upside in direction of the following resistance degree at 28,960 – the earlier excessive.

Dow Jones IndexEvery day Chart

Dow Jones Underpinned by Jobs and Housing Data, Final Debate in Focus

Straits Occasions Index Outlook:

Singapore’s Straits Occasions Index (STI) has rebounded from September’s low of two,450 on bettering market sentiment and hopes for additional leisure in Covid-19 measures. The variety of new coronavirus instances has fallen to single digits from low double digits, lifting hopes for extra lockdown unwindings. The Singapore authorities goals to enter a ‘section 3’ stage by year-end to permit extra actions to renew.

Technically, the STI seems to be supported by the 20-Day Easy Transferring Common (SMA) line, whereas capped by its 50-Day SMA lately (chart beneath). Breaking above the 50-Day SMA will possible open room for extra upside potential with an eye fixed on 2,600.

Straits Occasions Index Every day Chart

Dow Jones Underpinned by Jobs and Housing Data, Final Debate in Focus

Begins in:

Stay now:

Oct 26

( 11:10 GMT )

Study buying and selling world equities

FX Week Forward: Technique for Main Occasion Threat

Register for webinar

Be a part of now

Webinar has ended

— Written by Margaret Yang, Strategist for DailyFX.com

To contact Margaret, use the Feedback part beneath or @margaretyjy on Twitter