Credence Newsletter Week 26-30 Sep


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INDIAN EQUITY


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The DJIA opened the week on strong cueswith a gain of 2.5% on Monday and another

1.3% on Tuesday to close at 11190. Thecrucial German vote to expand the EFSF tobail-out Greece could not hold the market inthe midst of uncertainty, which representeditself in the form of 1.6% fall in the market. Allthe three indices broke their 50 DMA, whichnow forms a strong resistance.

On Thursday, the US Labor Departmentshared some great news with investors:

jobless claims fell by 37,000 claims to 391,000and second-quarter GDP growth was revisedup to 1.3%. This led to a small rally in the

market with moderate volumes. But, Nasdaqcould not hold ground despite the good newsdue to the on-going suit between Google andOracle, and the uncertainty over future plansfor giants like Microsoft, which for the first timelost its 2nd place as most valuable company interms of market capitalisation to IBM. Nasdaqfell by over 2%.

On Friday however, investors retreated afterlearning that inflation had risen in theEurozone countries. CNN Money reported thatconsumer prices went up by 3% in September.The high volatility in the US dollar index andthe on-going trouble with the IT companies ledto a gap between the movements of DJIA andNasdaq for the past couple of trading

sessions.

US EQUITY

Also, as seen from the charts, the volumes have remained

low and the MACD has not been able to hold above the 9

day signal line, indicating a down trend, further confirmedby the strong resistance provided by the 50 DMA for the

past 2 trading sessions after it was breached on

Wednesday.


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EUROPEAN EQUITY

European markets ended on a negative note

with the stocks with stocks were knockeddown lower over the week. Positive newscame from Germany. German parliamentapproved an expansion for Euro area rescuefund. The Bills passage will help in measuresto bolster Greece economy. The fund was onWednesday also passed by Finnishgovernment. Once the changes are

implemented the bail out funds lendingcapacity will increase to $ 598 million and themoney will be used with greater flexibility.Even after positive news markets have notresponded positively and all major European

indices closed with huge losses.

The risk of Euro split still remains a concernand the situation needs to be monitoredclosely in future. With anaemic growthnumbers coming from Germany investors arestill not reassured. Investors confidence isbattered by fears of a global recession and a

deepening euro zone debt crisis.

Going forward situation needs to bemonitored closely. Implementation of new

measures needs to be examined.


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METALS & OIL


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METALS & OIL


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Credence Newsletter Week 26-30 Sep