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WILL THE US500 AND ASX200 INDICES TURN UP??


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The US is currently in a mini recession (Mar qtr GDP -1.5%, Jun qtr negative maybe??).  The current bear market is as much about unwinding overvaluation as it is about correcting because of recession.  Stock market can turn up a month or two before second negative GDP print.  As economy slows, so will inflation.  Is the current increase in interest rates going to falter after the next rise because economy is slowing?  Will stock markets pre-empt this and turn up?  If you go long US500 or ASX200 indices, keep a tight stop just in case.

Any US recession caused by rising interest rates is long down the track into next year if at all.  US500 is trading at P/E17, a fair value especially when you consider the return on equity for this index is 15%+, a superb statistic.

On the charts, US500 is sitting on lower down trendline.  Will it bounce up?  I think its worth a long position both on ASX200 and US500 indices.

I welcome your comments.

S&P500 17 Jun 2022.jpg

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12 minutes ago, Engtechwins said:

The US is currently in a mini recession (Mar qtr GDP -1.5%, Jun qtr negative maybe??).  The current bear market is as much about unwinding overvaluation as it is about correcting because of recession.  Stock market can turn up a month or two before second negative GDP print.  As economy slows, so will inflation.  Is the current increase in interest rates going to falter after the next rise because economy is slowing?  Will stock markets pre-empt this and turn up?  If you go long US500 or ASX200 indices, keep a tight stop just in case.

Any US recession caused by rising interest rates is long down the track into next year if at all.  US500 is trading at P/E17, a fair value especially when you consider the return on equity for this index is 15%+, a superb statistic.

On the charts, US500 is sitting on lower down trendline.  Will it bounce up?  I think its worth a long position both on ASX200 and US500 indices.

I welcome your comments.

S&P500 17 Jun 2022.jpg

Thanks for sharing @Engtechwins

image.png

 

All the best - MongiIG

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I have changed my view.  US500 and FTSE100 are continuing to fall.  I now think it's still too early to go long ASX200 and US500.  Keep what I have said as an idea for a long trade maybe in 4 weeks or so after the next interest rate hikes.  For now, shorting FTSE100 may be profitable as BOE hikes interest rates.

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13 minutes ago, Engtechwins said:

I have changed my view.  US500 and FTSE100 are continuing to fall.  I now think it's still too early to go long ASX200 and US500.  Keep what I have said as an idea for a long trade maybe in 4 weeks or so after the next interest rate hikes.  For now, shorting FTSE100 may be profitable as BOE hikes interest rates.

Thanks @Engtechwins track the indices and looking forward to your future post updates.

All the best - MongiIG

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On 17/06/2022 at 15:43, Engtechwins said:

FTSE100

FTSE 100 and DAX move up as Dow futures hold steady

European markets are attempting to move higher this morning, while US cash markets are closed for a bank holiday.

 

 Chris Beauchamp | Chief Market Analyst, London | Publication date: Monday 20 June 2022 
 
Full article: IG
 
 
 
 
 
ig group.PNG
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