It was a mixed month for world equity markets, with net monthly changes ranging from +5.1% (South Africa), +3.9% (Hong Kong), +0.8% (Japan), +0.3% (China, Australia), -1.4% (Russia), -2.0% (USA), -2.1% (Germany), -3.1% (India), to -3.3% (Brazil).
Lets take our regular look at ten of the world equity markets.
USA - Dow
The mighty Dow broke a new historic high of 31272, but settled -623pts (2.0%) at 29982. I would note the monthly 10MA at 27491, which will act as first major support around 28000 in February.
Germany – DAX
Japan – Nikkei
Brazil – Bovespa
Russia - RTSI
India – SENSEX
China – Shanghai comp'
South Africa – Dow
Hong Kong – Hang Seng
Australia – AORD
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Summary
Five world equity markets were net higher, with five net lower.
South Africa and Hong Kong lead the way higher, whilst India and Brazil lagged.
The USA, Germany, Brazil, and Indian markets broke new historic highs.
All ten world equity markets settled January above their respective monthly 10MA, and I thus see the m/t trend as bullish.
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Looking ahead
Another very busy week is ahead with a truck load of earnings.
Earnings:
M - TMO, ON, NXPI, CRUS
T - BABA, PFE, UPS, XOM, BP, SIRU, HOG, MPC, AMZN, GOOGL, CMG, EA, FEYE, MTCH, AMGN
W - ABBV, SPOT, BIIB, HUM, PYPL, QCOM, EBAY, ALGN, QRVO, GRUB
T - CLX, BMY, MRK, PENN, YUM, PM, PINS, SNAP, F, PTON, ATVI, GILD, U, FTNT, GPRO, TMUS
F - REGN, EL
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Econ-data:
M - PMI/ISM manu', vehicle sales
T - Housing vacancies
W - ADP jobs, PMI/ISM serv', EIA Pet' report.
T - Weekly jobs, product/costs, factory orders
F - Monthly jobs, intl' trade, consumer credit
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Final note
So... one month down... eleven to go. Whilst the USA, and a number of other world markets settled net lower, January is still to be seen as a net bullish month, not least with new historic highs.
There is clearly ZERO reason to believe the various central banks will collectively tighten monetary policy until inflation significantly picks up. Besides, most governments need the central banks to soak up the extra bonds they are issuing.
This year has already seen the incredible story of Wallstreetbets fighting the hedge funds, and to some extent... winning. It should also be a reminder that naked shorts - not least on margin, are never a good idea, even if your credit lines are in the hundreds of millions, or even billions.
February can only be expected to be more wild, as we continue to walk ever deeper into... the twilight zone.
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Have a good weekend
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