Market Review 19-09

Market Review 19-09

Apple Stock Showing Weakness? That’s A Buying Opportunity

By Investing.Com

The level of excitement that many Apple lovers were expecting from last week’s product launch didn’t actually play out. Apple shares (NASDAQ:AAPL) dropped 1.2% on September 12 after Chief Executive Officer Tim Cook unveiled the smartphone maker’s latest gadgets.

Judging by the share performance, since reaching a record high of $229.67 on September 5, it seems Apple’s stock rally is losing some steam following its remarkable journey to becoming the world’s most valuable company this summer. But if you look back the Apple’s share price history, its stock has rebounded strongly after other post-launch lull periods.

There’s nothing to suggest this won’t happen again.

Despite weak performances by Apple stock following many of its new product launches, we continue to remain bullish on the company’s future. It will continue to benefit from strong business fundamentals and a general shift from social media stocks to hardware giants. Companies such as Facebook (NASDAQ:FB) and Alphabet (NASDAQ:GOOGL) are under pressure due to data privacy issues and there are indications that investment money is flowing from software to hardware.

In the short run, Apple stock may also come under pressure after President Donald Trump unveiled additional tariffs on $200-billion worth of Chinese goods. Apple has warned that the tariffs could hurt sales of its devices, including Apple Watches and HomePod speakers.

However, in our view, any share price weakness due to these temporary setbacks should be taken as a buying opportunity by long-term investors.

https://www.investing.com/analysis/use-any-apple-weakness-to-accumulate-more-shares-200344267

 

US Equity Analysis: Nasdaq Dip Buying Possible, DJIA Eyes Topside Target

By Justin McQueen

S&P 500
Despite the Trump administrations announcement of $200bln worth of tariffs on China, risk assets are unfazed with S&P 500 futures pointing to higher open at 0.2%. Alongside this, the tariff rate is to be set at 10%, as opposed to 25%, consequently taking the sting out of the latest round of tariffs. The S&P 500 continues to hover around the bullish 2889-2899 value, suggesting that there is scope for further upside. Consequently, the outlook remains modestly bullish.

Dow Jones Industrial Average
DJIA futures slightly firmer with gains of 0.2%. Risks are skewed to further upside with the index holding above the 26048 level, while the topside target is at 26335. The index continues to play catch up relative to the record highs seen in other US indices (S&P 500)

NASDAQ 100
Nasdaq 100 futures are outperforming this morning (+0.3%) following reports that tech giant Apple, are to avoid US tariffs on smartwatches and earbuds. The 7390-7451 pivot area provides key support for the index, which may present an opportunity for dip buyers back towards 7540-7603. However, a break below opens up the potential for a move towards 7265.

https://www.dailyfx.com/forex/market_alert/2018/09/18/US-Equity-Analysis-Nasdaq-Dip-Buying-Possible-DJIA-Eyes-Topside-Target.html

 

Sterling pulls back from six-week highs ahead of EU summit

By Tommy Reggiori Wilkes;Janet Lawrence

The British pound pulled back from six-week highs on Tuesday as traders booked profits and investors struck a more cautious note about progress towards a Brexit deal ahead of a European Union summit later this week.

Growing confidence that London and Brussels can secure an agreement has encouraged investors to cut short positions on the pound or to buy into the British currency, although a row within the ruling Conservative Party over the sort of deal Prime Minister Theresa May is proposing has capped gains.

EU leaders are due to meet in Salzburg in Austria later this week, a meeting British Brexit minister Dominic Raab has said would be an “important milestone”.

“While we are GBP-bullish ahead of the Salzburg EU summit, we hold back from selling EURGBP. Instead, we trade our bullish GBP call against the USD and the China-focused AUD,” Morgan Stanley analysts said in a note, referring to the Australian dollar and its vulnerability to the Chinese economy.

https://www.reuters.com/article/uk-britain-sterling-open/sterling-pulls-back-from-six-week-highs-ahead-of-eu-summit-idUSKCN1LY14G

 

Oil rises on signs OPEC not prepared to boost output

By Reuters

Oil firmed on Tuesday on signs that OPEC would not be prepared to raise output to address shrinking supplies from Iran and as Saudi Arabia signalled it was in no rush to bring prices down.

Bloomberg reported on Tuesday, citing unnamed Saudi sources, the kingdom was currently comfortable with prices above $80 per barrel, at least for the short-term.

The news agency reported that while the kingdom had no desire to push prices higher than $80 a barrel, it may no longer be possible to avoid it because of tightening supplies amid U.S. sanctions against Iran.

U.S. sanctions affecting Iran’s petroleum sector will come into force from Nov. 4.

However, the longer-term outlook remains weighed down by an escalation in the China-U.S. trade war that has clouded the outlook for crude demand from the world’s top oil consumers.

China said it had no choice but to retaliate against new U.S. trade measures after Trump imposed 10 percent tariffs on about $200 billion worth of Chinese imports.

“Oil markets are in a tug-of-war as Iran sanctions will continue to provide near-term support, while discussions around global demand in the wake of this morning’s tariffs and speculation of further OPEC supply increases should temper upside ambitions,” said Stephen Innes, head of trading at brokerage Oanda.

https://www.cnbc.com/2018/09/18/oil-markets-us-china-trade-war-in-focus.html

 

IBM’s Stock May Rise 7% Short Term

By Michael J. Kramer

International Business Machines Corp. (IBM) has failed to recover from its losses earlier this year, its shares still down more than 12% off their January highs. That may be changing. Technical analysis suggests that IBM is breaking out and may recoup some of those losses, rising by as much as 7%.

IBM’s revenue has fallen a staggering 26% after peaking at $107 billion in 2011. But investors may be growing more bullish as the company continues to move forward with growth initiatives, including the use of blockchain technology.

Technical charts show IBM breaking out of a pattern known as a wedge. Shares may continue to rise toward technical resistance of $159, an increase of about 7% from its current price. Should the stock reach resistance, it would also refill a technical gap created when the shares plunged in late April, falling from $161 to $149.

The relative strength index also has been trending higher since late June, a sign that bullish momentum is coming into the stock.

https://www.investopedia.com/news/ibms-stock-may-rise-7-short-term/

 

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