Equity Markets climbed to more than 10-week highs as investors focused on signs the American economy will continue to reopen, while U.S. Central Bankers acknowledged the severity of the Coronavirus pandemic when they met last month. Crude oil rallied for a fifth day. The S&P 500 erased all of Tuesday’s losses, with Lowe’s Cos. and Target Corp. reporting sales that topped estimates. The Index pulled back from its session high after the Senate passed a bill that could bar some Chinese companies from listing on American exchanges, adding to tensions between the nations. Gains were broad, with energy, financials and technology leading all 11 sector groups higher. The Index is up more than 30% since its March low, but the advance has largely petered out in May as volatility returned. U.S. Central Bankers saw the pandemic posing a severe economic threat and were also concerned by the risks to financial stability, Minutes of the April 28-29 Federal Open Market Committee meeting showed. The Stoxx Europe 600 Index erased an early decline to close higher. The Euro posted its fourth straight advance versus the Dollar, as expectations built for the approval of a region-wide stimulus plan. Gilts climbed as the U.K. sold bonds at a negative yield for the first time. Yields were steady as the U.S. Treasury resumed sales of 20-year bonds for the first time since 1986. The securities drew a yield of 1.220%, slightly higher than the 1.213% yield that traders were indicating before the sale. Investors have been whipsawed by conflicting news regarding a possible vaccine for the virus, as many governments around the world ease lockdowns even as the pandemic continues to spread, with Brazil now the world’s hotspot for new infections. The Euro’s gains coincided with progress on a 500 billion-euro ($550 billion) fiscal-stimulus plan by the European Union, though critics say the package may be too little, too late to counter the devastating effect on the region’s economies and bolster the outlook for corporate profits. Elsewhere, Equity Benchmarks in Japan and India saw the bulk of gains in a mixed Asian session, with Shanghai and Hong Kong in the red. In Japan, Tokyo Stock Exchange was among stocks which surged amid speculation that it may be a contender to join the Nikkei 225 equity index.
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For anyone following my Platinum Service it made 30 points yesterday and is now ahead by 1178 points for May, having made 4773 points in April, an incredible 9264 points in March, 2223 points in February, 2142 points in January, 818 points in December, 780 points in November, 1649 points in October, 1620 points in September and 2387 points in August Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1600 points
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The S&P 500 Index increased 1.6%, closing at a 10-week high at 2972.
The Dow Jones Industrial Average climbed 1.4% to 24,575.
The NASDAQ 100 closed 2.0% higher at 9485.
The Stoxx Europe 600 Index gained 1%.
The German DAX rose 2%, closing at 11,185.
Here is a summary of the main Changes in F.X. Markets:
The Bloomberg Dollar Spot Index decreased 0.3% to 1241.
The Euro advanced 0.5% to $1.0981.
The Japanese Yen strengthened 0.2% to 107.55 per dollar.
The British Pound declined 0.2% to $1.2230.
The yield on 10-year Treasuries was unchanged at 0.69%.
Germany’s 10-year yield fell one basis point to -0.47%.
Britain’s 10-year yield decreased two basis points to 0.23%.
The Bloomberg Commodity Index advanced 0.7%.
West Texas Intermediate crude increased 3.3% to $33.61 a barrel.
Gold advanced 0.1% to $1,749.3 an ounce.
This morning on the Economic Front we have German, Euro-Zone and UK Markit Services/Composite Manufacturing PMI at 8.30 am, 9.00 am and 9.30 am respectively. This is followed at 11.00 am by the UK CBI Distributive Trends Survey. At 1.30 pm we have the U.S Weekly Jobless Claims where the expectation is for a further increase of 2.4 million, bringing total Jobs lost since the Pandemic to 40 million. At the same time we have the release of the Philly Fed Manufacturing Index and this is followed at 2.45 pm by the Manufacturing Services/ Composite PMI. Finally, at 3.00 pm we have Existing Home Sales.
Meanwhile the Fed’s Clarida and Fed Chairman Powell are speaking at 6.00 pm and 7.30 pm respectively.
June S&P 500
The S&P is trading 23 Handles lower from last Night’s Chicago close as I go to press. Today is the 9th Weekly Jobless Claims since the onset of the Virus. Each Thursday, despite awful Jobless Claims, the market has subsequently surged. I am still flat the S&P and I will now raise my buy level 2908/2925 with a higher 2893 stop. Ahead of the Memorial Weekend in the US where the markets are closed on Monday, I will now raise my S&P sell level to 3015/3045 with a higher 3063 stop.
I am still flat the Euro and today I will raise my buy level to 1.0885/1.0915 with a higher 1.0835 stop. I still do not want to be short the Euro at this time.
June Dollar Index
I was stopped out of my 99.60 long position at 99.25 and I am now flat. Today I will be a small buyer from 98.50/98.90 with a 98.05 stop.
My DAX plan worked well with the market trading higher to my 11215 sell level. This morning the DAX is getting hit hard to trade at 11080 as I go to press. As I did not want to have an overnight position in the DAX I emailed my Platinum Members to exit any short position at 11185 and I am still flat. I am not going to chase the DAX higher and today I will leave my 10870/10940 buy level unchanged with the same 11805 stop. I will continue to be a seller into the 11240/11380 resistance area with a 11455 stop.
Just before the London close the FTSE hit my 6060 sell level before selling off to my revised 6045 T/P level and I am still flat. This morning the FTSE is opening at 6020 as for a change the market is stronger than both the US Indices and the DAX. The FTSE has resistance from 6075/6135 where I will be a seller with a 6195 stop.
Dow Rolling Contract
I am still flat the Dow. I will continue to be a buyer on any dip lower to 23950/24200 with the same 23785 stop. Even though the Dow is trading 250 points lower from last night’s close, I am not going to chase the market lower especially ahead of a long-weekend. Therefore, I will leave my 24900/25150 sell level unchanged with the same 25325 stop. The McClellan Oscillator, after a few negative closings, rallied yesterday to finish at +98. This is another reason why not to press the downside despite optimism at near record levels.
The NASDAQ closed within 250 points of its all-time February high of 9750. An incredible turnaround. This move higher saw the market hit my 9440 sell level. I am still short and I will add to this position at 9520. I will leave my stop unchanged at 9605. I will now raise my T/P level on this position to 9390, and if any of the above levels are hit I will be back with a new update for my Platinum Members.
The BUND opened higher this morning at my 173.00 T/P level as I was finally able to exit my 172.80 long position from Monday. Today I will be a buyer from 172.10/172.50 with a 171.65 stop. I still do not want to be short the Bund at this time.
Gold Rolling Contract
No Change as I am still a small seller from 1768/1780 with the same 1792 stop.
Silver Rolling Contract
Overnight, Silver hit my 17.10 buy level. I am still long and I will now lower my T/P level to 17.25. I will also raise my stop on this position to 16.80.