Market Outlook March 22nd - March 26th Print

 

 

Market Outlook

- US : US indices closed slightly up last week helped by gains in the Transportation (+2.52%), Commercial (+2.4%) and Health Care Equipment (+2.39%) sectors. Shares in the Energy (-1.12%) sector were under pressure however. From a technical point of view, the S&P 500 has finally managed to break above 1150 and although a pause cannot be ruled out, should extend its gains to the next major threshold at 1200. Only a break below 1115 (rising 50d moving average) would reinstate the short term downside risk.

- EUROPE : European indices had a mixed performance last week. The Cac 40, Ibex and AEX fell slightly whereas the Dax, FTSE 100 and SMI closed up week on week. Shares in the Health Care (+2.33%), Travel & Leisure (+2.23%) and Retail (+1.95%) gained whereas the Utilities (-0.6%), Telecommunications (-0.83%) and Basic Resources (-0.85%) were under pressure. On the STOXX 600, as long as 254 holds the index can continue its up move to 270.

 

  March 22nd - March 26th

 

Market Round up

 

Weekly chg (%)

Last

Dow Jones

1.1

10742

Nasdaq 100

.4

1932.4

Dax Xetra

.6

5982.4

Cac 40

0

3925.4

 Foreign Exchange

Euro/dollar : The pair is challenging its bearish channel upper boundary, the RSI is mixed and calls for caution. SHORT below 1.4250 towards 1.34 & 1.30.

Dollar/yen : The pair has rebounded on its support and is challenging its ST bearish channel upper boundary. LONG @ 88 with 93.80 or even 97.50 in sight.

Company preview

border=0 Walgreen (USD 34.53 ; 1.77% ; WAG ; WAG.N)
On Tuesday, Walgreen, the US largest drugstore is expected to report a 2Q EPS of $0.71 compared to $0.69 a year ago on sales of $17.2bln compared to $16.5bln. Early March, the Co announced it had completed the acquisition of certain assets from SpecialtyScripts, a subsidiary of Cardinal Health. From a technical point of view, the stock failed to push above a key resistance threshold @ $36 and remains capped by both the 50D moving average and a declining trend line. Therefore, the current bounce should be limited and the risk of a pullback towards $33 is high.

border=0 Carnival (GBp 2650 ; 1.92% ; CCL ; CCL.L)
The same day, Carnival, a Co offering a wide array of quality cruises, may deliver 1Q sales of appx. $3.1bln vs $2.8bln a year earlier and EPS of $0.12 vs $0.33 a year ago. Two weeks ago, the Co'CEO, Micky Arison forecast growth of 3m passengers a year mainly driven by a wider range of cruises coming onto the market, as well as more shorter cruises from UK ports. Technically, the upside breakout of a key resistance threshold 2500p is a positive signal that has opened the path to 2850p.

border=0 Eurasian Natural Resources (GBp 1160 ; -1.11% ; ENRC ; ENRC.L)
On Wednesday, Eurasian Natural Resources, a diversified natural resources group with mining, processing, energy and transport operations, could report a FY net income of appx. £1bln vs £2.6bln a year ago. Last month, the Co has agreed to acquire a majority stake in Chambishi Metals for $300m, a Zambian copper and cobalt producer. The Co plans also to invest appx $80m into Chambishi by the end of 2011, in new and upgraded production facilities. The investment should increase Chambishi's copper production capacity to 55 kilo tonne per annum of London Metal Exchange Grade A copper cathode. Graphically, the stock is clearly on the upside and technical indicators do not post any bearish divergence. Hence, we favour further upside towards 1300p as long as 1100p holds in the short term.

Oracle (USD 25.19 ; 0.56% ; ORCL ; ORCL.O)
On Thursday, Oracle, a Co providing integrated business software and hardware systems company, is expected to deliver a 3Q EPS of $0.37 vs $0.34 a year ago on sales of $6.2bln vs $5.5bln. From a chartist point of view, the stock is testing a key resistance threshold $25.7 which refers to its highest level in eight years. This level is key to break to see further medium term gains towards $27.1 (50% Fibonacci retracement) and $29 in extension.

Telecom Italia (EUR 1.087 ; 0.28% ; TIT ; TIT.MI)
The same day, Telecom Italia may report a FY09 net income around E1.81bln vs E2.2bln the previous year. Last week, Co's Chairman said synergies with Telefonica, its controlling shareholder, will rise in the forthcoming years (Il Sole 24 Ore). Earlier, the Co announced a collaboration with Intel Corp. to distribute next-generation online Internet and TV services via the open source MeeGo software platform. Graphically, the flat 20d and 50d moving averages should maintain the stock in its horizontal trading range between E1.00 and E1.15.

Selection of those events which may affect the stock prices of international Large Caps


Corporate Calendar March 22nd - March 26th

Date

Market

Company

Event

Monday, March 22nd

 

 

FR

Eurazeo

annual results

 

GR

Opap

annual results

 

UK

Wolseley

1st-Half results

 

US

Tiffany & Co

1st-Quarter results

Tuesday, March 23rd

 

 

IT

Mediaset

annual results

 

UK

Carnival

1st-Quarter results

 

UK

Cairn Energy

annual results

 

UK

Legal & General

annual results

 

US

Walgreen

1st-Quarter results

 

US

Darden Restaurants

3rd-Quarter results

border=0Wednesday, March 24th

 

 

GE

Q-Cells

annual results

 

UK

Smiths Group

1st-Half results

 

US

Paychex

1st-Quarter results

 

US

Lennar Corp

1st-Quarter results

 

US

General Mills

2nd-Quarter results

 

US

Red Hat

1st-Quarter results

border=0 Thursday, March 25th

 

 

GE

Hochtief

annual results

 

IT

Telecom Italia

annual results

 

UK

Kingfisher

annual results

 

US

Conagra Foods

1st-Quarter results

 

US

Oracle

1st-Quarter results

 

US

Best Buy

1st-Quarter results

border=0 Friday, March 26th

 

 

GR

Bank Of Greece

annual results

 

IT

Banca Monte Dei Paschi Siena

annual results

 

 

Date

Market

Economic data

Period

Expected

Last

border=0 Monday, March 22nd

 

   

No major economic data expected

     

border=0 Tuesday, March 23rd

 

15:00:00

US

Existing Home Sales (Mln)

FEB

5

5.05

border=0 Wednesday, March 24th

 

13:30:00

US

Durable Goods Orders

FEB

0.7%

2.6%

13:30:00

US

Durable Goods Ex Transportation

FEB

0.6%

-1%

15:00:00

US

New Home Sales (Thsd)

FEB

313.59

309

15:30:00

US

Crude Oil Inventories (WoW chg)

W11

NA

1012

border=0 Thursday, March 25th

 

13:30:00

US

Initial Jobless Claims (Thsd)

W11

NA

457

border=0 Friday, March 26th

 

13:30:00

US

GDP (QoQ)

4Q

5.8%

5.9%

13:30:00

US

GDP Price (QoQ)

4Q

0.4%

0.4%

13:30:00

US

Personal Consumption

4Q

NA

1.7%

14:55:00

US

U. of Michigan Confidence

MAR

73

72.5


 


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