Wow, what a week to start September. Well, instead of saying "a week", maybe it’s better to say "2 days"! First of all, it was really not a full week, given that Monday was a holiday for the US markets. Secondly, things really didn’t go anywhere until Thursday, until a coordinated (yes, you’d better believe it) effort from the central banks to boost the global economy!
Last weekend, in my Market Forcast, I said:
"For the new week, the market may be driven by news again. It seems like the global markets are waiting for more monetary easing from central banks. Any confirmed additional easing from either China or the US Fed would definitely give global markets a jolt. On Thursday, we’ll hear from the ECB on its latest policies. Again, SPX will need to break clear above 1420 to push higher."
As predicted, things didn’t go anywhere without confirmed news on more monetary stimuli. However, the ECB laid out a plan to purchase bonds on Thursday, without changing interest rates. Then, on Friday, China comes out with infrastructure spending plans to boost its economy, which sent the industrials on a solid bounce. The 2-day rally boosted the US indices to multi-year highs!
For the week, the Dow was up +215.8 points; SPX added +31.34 points; Nasdaq gained +69.46 points. Oil remained flat for the week, while gold ran on a "rush", topping $1730/ounce! Asian markets finally got a boost on Friday, and, at the time of this writing, they are slightly up to start the new week. Here’s how the US market looked after Friday’s close:
SPX added +5.8 points to close at 1437.92. Its daily MAs and MACD went up.
Nasdaq climbed +0.61 point to close at 3136.42. Its daily MAs and MACD also went higher.
Both SPX and Nasdaq broke above significant resistance. VIX turned back down sharply, ending above 14. For the new week…
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