Good morning. Well what a day yesterday. It looked like the 6960 area was going to hold then news broke of Saudi starting to attack Yemen, and equites fell and oil shot up. As per the plan I just flipped to short as it broke, managing to get in at 6945 for the run down to regain some points. The 6909 support area was overshot though the bulls did manage to stabilise things around the the 6890 area and we spent the rest of the session at around 6900. The US however was very bullish, with the S&P rising from the 2040 level where we had the bottom of the 20 day Raff (war is always good for US equities). Overnight has seen a bit of bullishness creep in, and with the bottom of the 10 day Raff at 6909 it will be interesting to see who runs the show today. There is still FTSE support at 6850 which may be seen today.
US & Asia Overnight from Bloomberg
(Bloomberg) — Asian stocks fell for a second day, adding to the biggest daily drop in almost two months, as industrial shares led declines and most Japanese equities went ex-dividend.
The MSCI Asia Pacific Index lost 0.2 percent to 147.10 as of 9:05 a.m. in Tokyo. The measure headed for a 0.3 percent decline this week after sliding 1.1 percent on Thursday. U.S. equities fell for a fourth day, with the Standard & Poor’s 500 Index erasing its 2015 gain, amid concern stock gains had got ahead of the outlook for the economy and corporate profits.
“We’ve had a lot of weak economic data in the first quarter in the U.S.,” Mark Luschini, chief investment strategist in Philadelphia at Janney Capital Management LLC, which oversees about $68 billion, said on Bloomberg TV. “We’re expecting to see earnings decline in the first and second quarters of 2015. This is not a formula for why stock prices should be significantly higher from here. That’s what the markets are trying to evaluate and are struggling with it.”
Japan’s Topix index slid 0.4 percent. More than 1,440 of the 1,858 companies in the index trade from today without the right to the next dividend payment, according to data compiled by Bloomberg.
The nation’s core consumer prices rose 2 percent from a year earlier in February, data released by the statistics bureau Friday showed, missing economist estimates for a 2.1 percent increase. Stripped of the effect of a sales-tax increase last April, core inflation — the Bank of Japan’s key measure — was zero.
South Korea’s Kospi index added 0.1 percent. Australia’s S&P/ASX 200 Index rose 0.3 percent. New Zealand’s NZX 50 Index advanced 0.1 percent. Markets in China and Hong Kong have yet to open.
The Shanghai Composite Index advanced 0.6 percent on Thursday, erasing earlier losses of as much as 1.3 percent, as energy and industrial companies rallied after oil prices surged and the government said it will promote industries including transport equipment.
West Texas Intermediate crude headed for the biggest weekly gain since 2011 after Saudi Arabia and its allies bombed targets in Yemen, which is near the center of global energy trade. Oil is still down 4.1 percent this year as U.S. crude output and stockpiles expand to the highest level in three decades and the Organization of Petroleum Exporting Countries resists calls to cut supply, exacerbating a global glut.
E-mini futures on the S&P 500 rose 0.1 percent today. The U.S. equity benchmark index fell 0.2 percent yesterday as declines in consumer and transportation companies overshadowed a rebound in technology shares.
A report this week showed U.S. durable-goods orders unexpectedly fell in February, adding to signs the economy is struggling to shake off winter doldrums. Other figures this month showed housing starts slumped, industrial production cooled and retail sales weakened. [Ref]
FTSE 100 Prediction
Overnight there has been a bit of strength upto and slightly past the pivot at 6920, however, first thing it has already dropped back to the 6900 area. There is some US GDP news out at 12:30 but nothing particularly market moving today, unless someone of the speeches by the Fed and BoE members that are happening state a surprise announcement, probably around interest rates. The chart for the open looks a bit bearish really, so I would expect a dip down to yesterdays low as we are failing once again to stay within the 10 day Bianca channel (bottom of that is 6908. Below 6875 we have 6850 support, then 6833 and the bottom of the 20 day Raff at 6813. For the bulls, they need to (a) break above the pivot, then more crucially 6937. Above this then 6960 (200ema on 30min and a PRT line), 6975 and a vague hope of breaking above 7000 to test 7050. Might be a big ask to go that high today though, but never say never. It really is quite tricky with the FTSE at the moment – while the Dax and S&P were climbing (200 and 20 points up respectively) the FTSE put on about 10. Probably find out the FTSE is the correct one and further downside across the board is imminent.