Performance of Retailers and Global Financial Institutions - Parallels with 2008

An interesting article from John Rubino via SafeHaven that highlights parallels between the rapidly deteriorating performance of  retailers and global financial institutions, very similar to that observed in 2008:

Interesting parallels between now and 2008 in the performance of key banking and retail stocks from Rajveer Rawlin

Chart of the Day - Emerging Market Debt

The chart of the day comes courtesy The Telegraph and shows Non-Financial corporate debt in emerging markets hitting record levels in several key currencies. The debt is well over 20 Trillion dollars and is over double the amount observed in 2008 prior to the great recession.

 

Market Signals for the US stock market S and P 500 Index and Indian Stock Market Nifty Index for the Week beginning May 9

Indicator	Weekly Level / Change	Implication for S & P 500	Implication for Nifty*
S & P 500	2057, -0.40%	Neutral	Neutral
Nifty	7734, -1.48%	Neutral**	Bearish
China Shanghai Index	2913, -0.85%	Bearish	Bearish
Gold	1290,-0.40%	Neutral	Neutral
WTIC Crude	44.56, -3.11%	Bearish	Bearish
Copper	2.15, -5.70%	Bearish	Bearish
Baltic Dry Index	631, -10.24%	Bearish	Bearish
Euro	1.140, -0.40%	Neutral	Neutral
Dollar/Yen	107.12, 0.74%	Bullish	Bullish
Dow Transports	7739, -1.69%	Bearish	Bearish
High Yield (ETF)	34.70, -1.19%	Bearish	Bearish
US 10 year Bond Yield	1.78%, -2.20%	Bullish	Bullish
Nyse Summation Index	1064, -12.42%	Bearish	Neutral
US Vix	14.72, -6.24%	Bullish	Bullish
20 DMA, S and P 500	2078, Below	Bearish	Neutral
50 DMA, S and P 500	2045, Above	Bullish	Neutral
200 DMA, S and P 500	2013, Above	Bullish	Neutral
20 DMA, Nifty	7791, Below	Neutral	Bearish
50 DMA, Nifty	7589, Above	Neutral	Bullish
200 DMA, Nifty	7833, Below	Neutral	Bearish
India Vix	16.95, 2.48%	Neutral	Bearish
Dollar/Rupee	66.61, 0.28%	Neutral	Neutral
Overall	S & P 500	Nifty
Bullish Indications	5	4
Bearish Indications	8	10
Outlook	Bearish	Bearish
Observation	The Sand P 500 and the Nifty fell last week. Indicators are bearish. Markets are failing at resistance. Time to tighten those stops as downside has resumed.
On the Horizon	China – Loan & Financing data, CPI, Euro Zone – German GDP, Euro Zone GDP, England – Rate decision, U.S – Retail sales, U. Mich. consumer confidence
*Nifty	India’s Benchmark Stock Market Index
Raw Data	Courtesy Google finance, Stock charts, FXCM
**Neutral	Changes less than 0.5% are considered neutral

The US market and the Nifty fell last week. Signals are bearish for the upcoming week. The Vix is suggesting complacency. The markets are breaking down from resistance and are likely to continue major breakdowns in 2016 as the recent rally appears to have concluded. A big move is imminent.  The critical levels to watch are 2070 (up) and 2050 (down) on the S & P and 7800 (up) and 7700 (down) on the Nifty. A significant breach of the above levels could trigger the next big move in the above markets. You can check out last week’s report for a comparison. You can also check out snapshots of the S and P 500 and Nifty Indices. Love your thoughts and feedback.