About

Ahead of the Curve provides analysis and insight into today's global financial markets. The latest news and views from global stock, bond, commodity, and FOREX markets are discussed. Rajveer Rawlin is a PhD and received his MBA in finance from the Cardiff Metropolitan University, Wales, UK. He is an avid market watcher, having followed capital markets in the US and India since 1993. His research interests include capital markets, banking, investment analysis, and portfolio management, and he has over 20 years of experience in the above areas, covering the US and Indian markets. He has several publications in the above areas. He currently teaches business and management students at CHRIST University. The views expressed here are his own and should not be construed as advice to buy or sell securities.

Sunday, 28 June 2015

Stock Market Signals for the US and Indian Stock Market for the Week beginning June 29

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Indicator	Weekly Level / Change / Significance	Implication for S & P 500	Implication for Nifty*
S & P 500	2101,- 0.40%	Neutral	Neutral
Nifty	8381, 1.9%	Neutral**	Bullish
China Shanghai Index	4193, -6.37%	Bearish	Bearish
Gold	1174, -2.18%	Bearish	Bearish
WTIC Crude	59.65, -0.07%	Neutral	Neutral
Copper	2.64, 2.62%	Bullish	Bullish
Baltic Dry Index	823, 5.65%	Bullish	Bullish
Euro	1.1168, -1.74%	Bearish	Bearish
Dollar/Yen	123.87, 0.94%	Bullish	Bullish
Dow Transports	8242,- 2.01%	Bearish	Bearish
US 10 year Bond Yield	2.48%, 9.22%	Bearish	Bearish
Nyse Summation Index	-208, -4.43%	Bearish	Neutral
US Vix	14.02, 0.43%	Neutral	Neutral
20 DMA, S and P 500	2103, Below	Bearish	Neutral
50 DMA, S and P 500	2107, Below	Bearish	Neutral
200 DMA, S and P 500	2053, Above	Bullish	Neutral
20 DMA, Nifty	8181, Above	Neutral	Bullish
50 DMA, Nifty	8262, Above	Neutral	Bullish
200 DMA, Nifty	8364, Above	Neutral	Bullish
India Vix	15.76, 4.47%	Neutral	Bearish
Dollar/Rupee	63.45, -0.03%	Neutral	Neutral

Overall	S & P 500	Nifty
Bullish Indications	4	7
Bearish Indications	8	6
Outlook	Bearish	Marginally Bullish
Observation	The Sand P 500 was nominally down last week while the Nifty outperformed significantly. The Vix, transports and summation index are flashing warning signs. Market cycles are favorable till July but indicators are turning bearish so a pull back is likely next week.
On the Horizon	Greece discussions, US, UK and Canada PMI data, US payroll data

*Nifty	India’s Benchmark Stock Index
Raw Data	Courtesy Google finance, Stock charts
**Neutral	Changes less than 0.5% are considered neutral

Signals are bearish for the upcoming week. You can check out last weeks report for a comparison.

No comments:

My Asset Allocation Strategy (Indian Market)

Cash - 40%
Bonds - 20%
Fixed deposit - 20%
Gold - 5%
Stocks - 10% ( Majority of this in dividend funds)
Other Asset Classes - 5%

My belief is that stocks are relatively overvalued compared to bonds and attractive buying opportunities can come along after 1-2 years. In a deflationary scenario no asset class does well other than U.S bonds, the U.S dollar and the Japanese yen, so better to be safe than sorry with high quality government bonds and fixed deposits. Cash is the king always. Of course this varies with the person's age.