Elliott Waves: Hang Seng Index’s Rally May End This Month: Technical Analysis
(Bloomberg) -- Hong Kong’s benchmark Hang Seng Index may extend gains until the end of the month before falling back below 21,000, according to an Elliott wave analysis by DMG & Partners Securities Pte.The gauge, which closed at 22,279.58 yesterday, appears to be within the initial stages of the final phase of the five-wave market cycle developed by accountant Ralph Nelson Elliott during the Great Depression, said James Lim, an analyst at DMG in Singapore. The Hang Seng Index completed wave four in late December, Lim said.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aigovLjQidIw
Pound to Drop on ‘Dead Cross’ Versus Dollar: Technical Analysis
(Bloomberg) -- The British pound may fall toward a three-month low against the greenback as it is close to forming a so-called “dead cross” trading pattern, according to Gaitame.com Research Institute Ltd.Sterling is nearing a dead cross as the currency’s recent declines push it closer to its longer-term moving average, which normally signals an extended drop, said Kumiko Gervaise, a Tokyo-based currency analyst at the research unit of Gaitame, Japan’s biggest currency margin trader.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aHXV491Oc818
U.S. Two-Year Treasury Futures to Rally: Technical Analysis
(Bloomberg) -- Treasury two-year futures contracts are poised to rally in January as their slide to their worst month on record in December is likely to reverse, said DZ Bank AG, citing trading patterns. The contract had a so-called bullish engulfing day on Jan. 4, said Andy Cossor, the Hong Kong-based chief market strategist for Asia for Frankfurt-based DZ Bank, Germany’s fifth-largest lender. The pattern occurs on a candlestick chart when a small solid box, which is created by a decline in price, is followed the next day by a large empty box, reflecting a gain. The second candlestick is bigger than, or “engulfs,” the first one.Using the same chart, Cossor, drew a descending line connecting the highs of Dec. 18 and Dec. 31 and extrapolated it to today. The contract is above the line now, a second positive sign.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aTbhW8kyv7m0
DAX May Rally to 6,200 Before ‘Anticlimax’: Technical Analysis
(Bloomberg) -- Germany’s DAX Index may climb as high as 6,200 in a short-term rally, followed by an “anticlimax” due to overly optimistic investor sentiment and rising interest rates, according to a technical analyst at DZ Bank AG who looks at chart patterns to predict market movements.“Profit taking on the last day of trading for 2009 failed to push the index south of the 38.2 percent Fibonacci retracement of the last tertiary upward trend impulse around 5,865,” said DZ Bank’s Armin Kremser, who derived the level from a peak near 6,027 on Dec. 29. “There is an increased likelihood of the positive trend continuing,” he wrote in a report today.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=ar4zkVHQdqPY
Oil Rally May Falter at $82, MF Global Says: Technical Analysis
(Bloomberg) -- Crude oil’s rally to a two-month high may sputter around $82 a barrel as the commodity’s relative strength index signals that gains have been excessive, according to technical analysis by MF Global Ltd.Oil advanced for an eighth day in New York today, trading above $81 a barrel for the first time since November, as freezing temperatures around the Northern Hemisphere bolstered the outlook for fuel demand. The surge will probably founder before it reaches last year’s peak of $82 a barrel, MF Global said in a report.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aQNVtOLpKho0
Dollar & GDP To Surprise To The Upside, Says Strategist
By: Lee Brodie Producer
On Tuesday's Fast Money, widely followed strategist Richard Bernstein suggested making bullish bets on the dollar as well as GDP into 2010.In case you’re not familiar with Bernstein, he was renowned for being bearish, but turned bullish over the past few months.
And he's become very bullish. Following are three of his predictions about the dollar.
- The US dollar is likely to meaningfully appreciate once market-driven short-term rates begin to rise.
- US dollar “carry trades” could get killed as 2010 progresses and the US dollar appreciates. Once accounting for leverage, hedge fund performance will likely trail long-only equity performance.
- The Fed will spend the second half of the year trying to catch up to, and flatten, the yield curve. Short-term rates could increase more than investors currently think.
http://www.cnbc.com/id/34706717
January Indicator: A First Day Rally Is Positive Sign for Stocks
By: AP
If the stock market holds to a pattern it has followed for most of the past 40 years, 2010 could be a big year for investors.Since 1973, a big advance on the first trading day of January has been a strong sign stocks will post robust gains for the rest of the year. On Monday, upbeat news about manufacturing lifted the Dow Jones industrial average 155 points, or 1.5 percent. The Standard & Poor's 500 index rose 17 points, or 1.6 percent.When the S&P 500 has gained more than 1 percent on the first day of trading, the index has ended the year higher 86 percent of the time, according to Schaeffer's Investment Research.
http://www.cnbc.com/id/34705655
Stocks, Bonds Could Outpace Economy This Year: Prudential
By: Jeff Cox CNBC.com
Investors face a profitable if volatile year ahead as stocks and bonds outpace a sluggish economy, experts at Prudential Financial said Tuesday.US stocks will post gains matching 2009's massive surge while global equities could perform even better, the firm said during a panel discussion in New York. Bond investors may have to be more selective but could see opportunities in corporates and Treasurys, according to the panel.Overall, investors will have to adjust to a different environment than last year, when stocks bounced off generational lows and now will look for firmer footing ahead.
http://www.cnbc.com/id/34707234
Volatility Will Increase, US Will Lead in 2010: Marc Faber
By: Antonia Oprita Associate Web Producer, CNBC.com
Markets are likely to be more volatile and US markets are likely to outperform emerging markets in 2010, Marc Faber, author of the Gloom, Doom and Boom Report, told CNBC Wednesday."I think 2009 was an extraordinary year for capital gains because both commodities and stocks became extremely oversold," Faber said in an interview."I think 2010 is a year when capital preservation will be more important because I expect a lot of volatility up and down," he added.Since the lows hit in March, US stocks rose by around 70 percent but emerging markets rose by much more than that, according to Faber, who quoted the example of the Russian market which advanced 220 percent.
http://www.cnbc.com/id/34629327
Chinese Equities Rally to Fade This Year, Deutsche Bank Says
(Bloomberg) -- A rally by China’s stocks may fade from the second quarter as inflation triggers “significant policy tightening” by the government and the U.S. economy weakens, Deutsche Bank AG said. The MSCI China Index may still end the year 15 percent higher, Ma Jun, Deutsche Bank’s Hong Kong-based China economist, said in a note to clients. The index tracking mostly Chinese companies traded in Hong Kong jumped 59 percent last year after losing 52 percent in 2008.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aVr8ZlvIn0.U
Emerging Stocks Lose 20% as Mobius Sees IPO Backfire
(Bloomberg) -- Emerging markets are attracting more money from initial public offerings than industrialized nations for the first time ever, a warning sign to Mark Mobius that the record rally in the shares may turn into a 20 percent decline. Faster economic growth may help China, India and Brazil produce the biggest increases in IPOs and almost double sales to $200 billion worldwide, according to Matthew Johnson, the New York-based head of the global-equities syndicate at Barclays Plc. Poland alone may offer more than $10 billion of state-owned companies, according to estimates by UniCredit SpA.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=arKPVdUsBfMY
Emerging Funds End 2009 With Record Flows, EPFR Says
(Bloomberg) -- Emerging-market stocks and bond funds closed 2009 with record annual inflows as a recovery from the global financial crisis boosted demand for riskier assets, according to U.S.-based research company EPFR Global. Emerging-market equity funds received $64.5 billion, while those investing in developing-nation fixed-income securities drew more than $8 billion, EPFR in Cambridge, Massachusetts, said in an e-mailed statement, citing initial figures from funds reporting daily and weekly. Gains last year followed outflows of about $67 billion in 2008, when the failure of Lehman Brothers Holdings Inc. froze world credit markets. The MSCI Emerging-Markets Index of stocks rallied 75 percent in 2009, the most since the gauge was introduced in 1987. Emerging-market debt produced a 28 percent return, the best since 1996, according to JPMorgan Chase & Co.’s EMBI Global Index.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aSd7EoovbHeA
China May Introduce Index Futures as Early as March
(Bloomberg) -- China’s securities regulator may introduce futures contracts on the country’s stock indexes as early as March, an official with knowledge of the matter said. The State Council, China’s cabinet, has given the China Securities Regulatory Commission approval “in principle” to introduce index futures, said the person, who declined to be identified before an announcement. The first contract, based on China’s CSI 300 Index, may begin trading after the Communist party’s annual congress in March, the official said.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aSr2NDaFWWok
China Stocks Set for 2010 Rally, Goldman Sachs Says
(Bloomberg) -- Investors should be positioned for a rally in China stocks in the first quarter of this year, driven by favorable policy and liquidity, Goldman Sachs Group Inc. said. “Macro growth momentum and policy variables could dictate the path of returns, which could be skewed to the first and fourth quarters and could show high volatility on tightening concerns,” Thomas Deng and Kinger Lau, analysts at the brokerage, wrote in the report.China’s CSI 300 Index rallied 97 percent last year while the Hang Seng China Enterprises Index, tracking so-called H shares of Chinese companies listed in Hong Kong, rose 62 percent. The results were helped by “aggressive government stimulus globally,” the analysts said. Those measures included 9.2 trillion yuan ($1.35 trillion) of new loans and a $586 billion domestic stimulus package in China.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a1DmmU.kEBMk
Gold May Extend Biggest Rally in Two Months as Dollar Declines
(Bloomberg) -- Gold, little changed in Asia, may extend its biggest rally in two months as the dollar declines, boosting demand for the precious metal. The U.S. currency may weaken against a basket of six counterparts after Federal Reserve Governor Elizabeth Duke said “moderate” economic growth is likely to warrant low interest rates for an “extended period.” Gold rallied 24 percent in 2009 as investors hedged against a declining dollar.“The defining agent of this year’s action will once again be the path that the U.S. dollar eventually takes,” Jon Nadler, senior analyst with Kitco Metals Inc., wrote in a report.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a6gQAD9zShyM
Asia Bond Risk Drops to May 2008 Low on U.S. Economic Optimism
(Bloomberg) -- The cost of protecting Asia-Pacific corporate and sovereign bonds from default fell to the lowest level since May 2008 on optimism a recovery in the world’s largest economy is gathering pace.“Compared with the uncertainties we had last year, there’s more clarity,” Jason Rogers, a credit analyst at Barclays Plc, said in a phone interview from Singapore. “On balance, the outlook is more positive than negative.”
U.S. stocks advanced the most in two months yesterday after a gauge of manufacturing rose more than estimated and freezing weather boosted the price of oil. The S&P 500 rose 1.6 percent to 1,132.99 in New York, its highest close since Oct. 1, 2008.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a37dHz19ejho
Oil to Rise With Dollar, Snap Inverse Link, Archbridge Says
(Bloomberg) -- Oil will extend 2009’s rally this year in tandem with a strengthening dollar, as the resurgent global economy buoys both assets and snaps their inverse relationship, according to Archbridge Capital AG. A decline in the U.S. currency last year aided a 77 percent recovery in crude-oil toward $80 a barrel as investment managers and banks sought higher-yielding alternatives to mitigate the risk of inflation. Global growth in 2010 will bolster the dollar and oil, which will gain on supply constraints, according to Zug-Switzerland-based Archbridge.“Economic growth will propel both the dollar and oil, and break the negative correlation,” Archbridge Chief Investment Officer Hakan Kocayusufpasaoglu said in an interview in London. “Dollar appreciation is on the cards. And oil will go up irrespective due to its fundamentals.”
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=asCW5kUpvmYM
Copper ‘Breaking Higher,’ $7,760 ‘In Play’: Technical Analysis
(Bloomberg) -- Copper, which more than doubled last year, is “breaking higher” after passing through a so-called Fibonacci retracement level, according to technical analysis by Dan Smith, an analyst at Standard Chartered Plc. Copper’s rise above $7,495 a metric ton on the London Metal Exchange yesterday was a 76.4 percent retracement level, and that means $7,760 a ton is “in play now,” Smith wrote in a report. The $7,760 price is the low the metal reached in June 2008, one month before reaching a record $8,940 a ton.“The break above the previous high suggests we have more room to move upside from here,” London-based Smith said today by phone.Copper had its best year in at least two decades in 2009 as demand in China, the world’s largest buyer, climbed to a record. Prices have advanced another 1 percent this year after workers went on strike in Chile, the world’s largest copper producing nation.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aqEmpfIQAldY
Oil to Average $75 a Barrel This Year, Oppenheimer’s Gheit Says
(Bloomberg) -- Crude oil will average $75 a barrel this year, 21 percent higher than in 2009, as the economic recovery boosts demand and hedge and pension funds maintain investment in commodities, according to Oppenheimer & Co. “Demand is likely to improve because the economic outlook is looking positive,” Fadel Gheit, a New York-based analyst at Oppenheimer, said today in a Bloomberg Radio interview. “Oil prices are likely to fluctuate between $65 and $85 and average for the year about $75.”Oil posted its biggest annual gain in a decade last year, recovering from its $100 slump in the second half of 2008 on signs the worst of the global recession was over. Monthly contracts for the rest of this year are already trading at about $75 on the New York Mercantile Exchange, indicating prices will converge around this level, Gheit said.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a0gSrqTRdeC4
Palm Oil Has Best Annual Advance in 12 Years on Demand Outlook
(Bloomberg) -- Palm oil jumped 2.6 percent to the highest in more than seven months for the best annual performance in 12 years on anticipation demand will increase from India, the second-biggest consumer.Palm oil, which has more than doubled in the last decade, has rallied 57 percent this year on rising demand from India and China, the biggest user. Tight supplies of soybean oil earlier this year due to drought damage in South America have also fueled price gains.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aUAbjgrFz5bE
Lead, Sugar Top Decade’s Commodity Gains; Lumber Falls
(Bloomberg) -- Lead and sugar futures more than quadrupled since the end of 1999, leading the decade’s gains as of today among 36 commodities in the U.S., Europe and Asia. Three raw materials declined in the 10-year period with lumber prices posting the biggest drop.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a78pGdNYdETk
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