CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
✖

European Open: Equities bounce on Omicron fatigue

Article By: ,  Market Analyst
December 21, 2021 4:34 AM

Asian Indices:

  • Australia's ASX 200 index rose by 58.5 points (0.8%) and currently trades at 7,350.70
  • Japan's Nikkei 225 index has risen by 555.75 points (1.99%) and currently trades at 28,491.63
  • Hong Kong's Hang Seng index has risen by 121.1 points (0.53%) and currently trades at 22,865.96
  • China's A50 Index has risen by 15.39 points (0.1%) and currently trades at 15,758.89

UK and Europe:

  • UK's FTSE 100 futures are currently up 67 points (0.94%), the cash market is currently estimated to open at 7,265.03
  • Euro STOXX 50 futures are currently up 42.5 points (1.04%), the cash market is currently estimated to open at 4,149.63
  • Germany's DAX futures are currently up 142 points (0.93%), the cash market is currently estimated to open at 15,381.67

US Futures:

  • DJI futures are currently up 192 points (0.55%)
  • S&P 500 futures are currently up 138.5 points (0.89%)
  • Nasdaq 100 futures are currently up 27.75 points (0.61%)

Asian equities post corrective gains despite weaker sentiment

New Zealand have delayed the reopening of their borers from mid-January to February, due to the rise of Omicron cases globally. The US reported its first Omicron-linked death, Netherlands have imposed a strict lockdown regime over Christmas and Singapore is investigating breakout linked to a gym. In the UK number have never been so dire, and the new variant has been reported in 89 countries. It is certainly what anyone wanted for Christmas, but that is what markets have been responding to this week and why Santa’s rally appeared to be dead in the water. Or is it?

Asian equities are broadly higher overnight in what is assumed to be fuelled by short-covering and / or profit taking. That is not to say we have a risk-on environment, but more of a tired risk-off environment. Following 3-days of heavy selling then perhaps it is time for a bounce, even if it goes against sentiment.

200-day eMA’s key for oil today

And one market to look for risk sentient is oil prices. Like Asian indices, we have seen a corrective bounce on WTI and brent. In both cases they opened beneath their 200da eMA’s yesterday (although WTI also opened below $70) before selling off but then reversing. Brent is currently probing its 200-day eMA from below, so we suspect it will be an important area for traders of both markets to watch.

RBA released their final minutes of 2021

The RBA’s minutes presented three options for how they may alter their QE program at their February meeting, with my colleague Tony Sycamore currently favouring that they will cease it, given the hawkish turn of central banks of late.

The euro firms against antipodean currencies

On today’s Asian report we noted that EUR/NZD had broken out of a compression pattern o the daily chart and that it is carving out a strong bullish trend. We are also keeping an eye on EUR/AUD for a move higher, although it is yet to break key resistance levels to confirm the resumption of its trend.

We can see on the four-hour char that EUR/AUD is forming a consolidation pattern near yesterday’s highs. It met resistance at the weekly R1 pivot, but this resistance would be invalidated if it can break above the 1.5908 high. If it can manage that whilst holding above its recent consolidation lows then our next targets are 1.6000 and the weekly R2 pivot around 1.6030.

FTSE 350: Market Internals

FTSE 350: 4111.24 (-0.99%) 20 December 2021

  • 67 (19.09%) stocks advanced and 281 (80.06%) declined
  • 3 stocks rose to a new 52-week high, 11 fell to new lows
  • 45.58% of stocks closed above their 200-day average
  • 35.33% of stocks closed above their 50-day average
  • 16.81% of stocks closed above their 20-day average

Outperformers:

  • + 6.51% - Rentokil Initial PLC (RTO.L)
  • + 5.24% - Oxford BioMedica PLC (OXB.L)
  • + 4.31% - Moneysupermarket.Com Group PLC (MONY.L)

Underperformers:

  • -7.10% - Cineworld Group PLC (CINE.L)
  • -6.83% - Trustpilot Group PLC (TRST.L)
  • -5.51% - Antofagasta PLC (ANTO.L)

 

Up Next (Times in GMT)

 

How to trade with City Index

You can easily trade with City Index by using these four easy steps:

  1. Open an account, or log in if you’re already a customer 

    • Open an account in the UK
    • Open an account in Australia
    • Open an account in Singapore

  2. Search for the company you want to trade in our award-winning platform 
  3. Choose your position and size, and your stop and limit levels 
  4. Place the trade

 

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.

© City Index 2024