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DAX, DOW and FTSE mixed as global growth signals slowdown


  • DAX 40:Lower on the back of gloomy Euro-area data.
  • FTSE 100:Flat as inflation pushes up UK debt costs.
  • DOW JONES:Flat as markets think about recession fears.

DAX 40: Marginal lower on the back of gloomy Euro-area data

The Dax struggled in European trade this morning and climbed lower as gloomy data in the eurozone was fed into recessionary fears. While a Reuter poll published earlier Thursday predicted a one in three chance of a recession in the bloc within 12 months. This morning we had a string of European PMI data from France, Germany and the eurozone. High prices in the eurozone meant that demand for manufactured goods fell at the fastest pace since May 2020 in June, when the covid pandemic took hold. The S&P Global heading factory Purchasing Manager’s Index (PMI) dropped to an almost two year low of 52.0 from 54.6. German manufacturing PMI also suffered a blow to Europe’s most industrialized economy, which fell from 54.0 to 52.0, which will undoubtedly have a negative impact on the components of the DAX 40.

The sectoral distribution is mixed as such while affecting individual moversd by numerous brokerage movements. The only notable motive was Deutsche Bank AG, which was 4.80% lower for the session as we approached the US market.a.

DAX 40 Daily Chart – 23 June 2022

Source: IG

From a technical perspective, last week we had a clumsy chandelier nearby (weekly candle) that closed under the key support that resistance twisted at the 13270 area. Yesterday’s daily close formed a three-pin candle stick formation at the resistance area 13270 indicating a potential for further disadvantage.

A daily candle closing below the 12950 area could open a re-test of year-to-date lows. A weathering from here could lead to a retest of 13270 area.

Key intraday levels that might be worth checking out:

Support Areas

Resistance areas

FTSE 100: Flat as inflation drives British debt costs

The FTSEdecreased by about 0.50% on Thursday’s European Open as the UK government borrowed more than expected last month due to rising inflation. Data released by the Office for National Statistics (ONS) showed this CChancellor Rishi Sunak borrowed another £ 14 billion ($ 17 billion) in May, which was £ 2 billion higher than city economists had predicted.May’s loans raised national debt, excluding public sector banks, to £ 2.36tn, or about 95.8% of GDP.“Rising inflation and rising debt interest costs pose a challenge to public finances, as well as to family budgets,” Sunak said in a statistic.ement.

British commuters, meanwhile, had to deal with a repeat of Tuesday’s widespread rail stoppage today. The RMT union said a nationwide strike would continue after agreement talks broke down.

UK manufacturing companies hit by a slowdown in demand and new orders amid a looming recession, new data showed Thursday.According to S&P Global’s survey, June’s overall composite PMI index, which tracks activity in the economy, was unchanged at 53.1, but new order growth this month was the weakest since March 2021.

The FTSE recovered as the session progressed, trading flat-to-marginal lower as we approach the US market open. The energy sector was the biggest gainer of the session with 1.6%, while notable executives included Ocado Group PLC, BP ​​PLC and Shell PLC with gains of 3.7%, 2% and 1.5% respectively.

FTSE 100 Daily Charts – 23 June 2022

DAX, DOW and FTSE mixed as global growth signals slowdown

Source:IG

The FTSE closed as a bearish engulfing daily candle of resistance area 7150, indicating the potential for further downside. We have since retreated from resistance to hover just above the key psychological level of 7000. At this point, we seem to be switching between resistance at 7150 and most recent support at the 6950 area. The intraday range could provide an opportunity if we can not break the support or resistance levels at 6950 and 7150 respectively.

Key intraday levels that might be worth checking out:

Support Areas

Resistance areas

DOW JONES: Flat as markets think about recession fears

USA vgluities had a mixed futures market as an initial drop of about 200 points was wiped out as we opened up the US market. It continues yesterday’s trend where US equities swung back and forth between losses and gains. Bond yields tumbled as comments by Federal Reserve Chairman Jerome Powell and growth data in Europe sparked fears of global downturn. US 10-year yields traded close to a two-week low of 3.08%. Chair Powell accepted that sharp rate hikes could cause a US recession and said the task of designing a soft economic landing was “very challenging” in testimony to the Senate on Wednesday.

Money markets indicate reduced chance that the central bank will raise rates after year-end, and rising chance of a rate cut from May 2023. This may partly explain the swing in US equities between gains and losses, as markets debate how far the Fed will stretch its price cycle.

On the calendar front, we still have S&P Global Composite PMI Flash, Fed Bank Stress Test Results and of course the testimony of Fed Chairman Powell before the House Financial Services Committee.

DAX, DOW and FTSE mixed as global growth signals slowdown

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DOW JONES Daily Chart- 23 June 2022

DAX, DOW and FTSE mixed as global growth signals slowdown

Source:IG

From a technical perspective, yesterday’s daily Christmas closing gave no clear indication, and closed indecisively. Currently series bound on a daily chart between the 31000 and 29500 areas. Unless we get a daily candle near the resistance area (31000) or close below support (29500), we will probably stay series bound. Intraday opportunities can exist within the series.

Key intraday levels that might be worth checking out:

Support Areas

Resistance areas

Written by: Zain Vawda, Market Author for techlives.in

Contact and follow Zain on Twitter: @zvawda

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