2021 is all about looking forward, not backward. I am very much embracing that spirit and taking up the offer to move to join our algo team. It’s safe to say that I cannot wait – exciting times ahead. What it does also mean though is that this will be the valedictory 2:15. We are moving to an end of day summary that my colleagues write. If you would like to be added to that distribution do please just let me know. In these wild markets every little helps!

My last 2.15 comes at the end of one of the wildest weeks – markets possibly exhausted by all the excitement have drifted lower but on volumes that are a lot lower than we’ve seen all week. Europe has been testing their 50dma lately and that remains the key technical level for most indices. Looking at sectors, Tech has been the only one in the green all morning although Ericsson is helping out there (reported strong set of results, ERICB SS +10%). The rest of the sectors are all in the red although we should not forget their performance in the prior month. Technology top performer (up 5.2% in Jan so far), followed by Basic Resources (up +3%) and Healthcare (+2.7%). Main laggards include Insurance (-2.8%), Travel & Leisure (-2.7%) and Food & Beverage (-2.6%).

Holy Moly – there is definitely something going on behind the scenes but I must admit it is quite nerve racking watching it all. I was going to start with “all eyes on the Fed” or something along those lines but nope,  “All eyes on the short-squeezed stocks!”. Credit goes to one of our US colleagues (Casey Badach) who actually pointed out the Reddit / Gamestop dynamics last Friday and look where we are today!

After the most awaited snowfall in London yesterday and Europe opening in the green this morning, a mixed set of news killed the positive sentiment pretty quickly. Equities managed to trade quite steady all morning but have ran out of steam by now (SXXP -0.7%, down -1.3% from its intra-day high). Defensives have been outperforming Cyclicals all day with Healthcare and Technology leading the way. Travel & Leisure amongst the main laggards (-2.0%). Lockdown news not helping the case with the UK thinking on imposing an Australia style hotel quarantine when entering the country and France likely to impose a lockdown in the next couple of days. Keep watching the SX5E – getting closer to its support level of 3524 (3565 last).

Pretty gloomy end to the week with European equities tracking lower since the open. Some indices have slipped below their 50dmas but the ones we have been watching this week remain above it. Eurostoxx 50 the main one, support at 3540 (50dma) and 3525 (this month’s low) – 3595 last. DAX another one, 50dma at 13490 and former Sept high at 13460. Volumes actually showing us some conviction here (up +25% vs 30dAVAT). Strangely it doesn’t feel as busy as it looks and I’m sure dealing desks would agree – Zzzz. Looking ahead, at least we have a busy week of earnings to look forward to. I attached the Redburn’s earnings and events calendar for the next two weeks so you have it in hand!

34803 QUOTE OF THE DAY “For there is always light, if only we are brave enough to see it…if only we are brave enough to be it” Amanda Gorman – last line of her Inauguration poet KEY INDEX MOVES   Stoxx50 FTSE CAC FTSEMIB ▲ +0.1% ▲ +0.1% ▼ -0.3% ▼ -0.4% Media Technology Autos […]

The day has finally arrived!

As we await for the inauguration of President-Elect Biden, markets are showing us some encouraging moves underneath the water. Overnight, the Nasdaq 100 Equal Weight (NDXE) made a new all-time rel high (vs S&P 500) for the first time since 2005. In Asia, the Hang Seng closed strong once again and made a new all-time high this morning. Alibaba contributed to the move (closed +8.5%) after its co-founder Jack Ma finally appeared in public (last seen in October). Here in Europe, smallcaps continue to outperforming with the Stoxx Europe Small 200 (SCXP) making a new 20year rel high earlier. Growth/Value remains steady though with STVP +0.7% and STGP up +0.8%.

Tik Tok, Tik Tok – clock is ticking!

Quiet day for markets this morning ahead of Janet Yellen’s testimony and Mr. Trump’s last full day on the job. You must be tired of reading the word “dull” by now but today (so far) is without doubt another one to add to the “dull day” list. Indices all steady overall (SXXP +0.09%) with defensives outperforming cyclicals. Volumes better than yesterday but still tracking -18% lower vs the last 30 days. Note UK is showing some signs of life with the small caps (SMXX) making another two year high today. Keep an eye on sterling perhaps, it is near the top of its 7 month range vs the Euro. Key resistance at 1.1285 – 1.1219 last.

A bit of a pause for breath today amid Martin Luther King Day.

CSI 300 and HIS the highlight in Asia this morning following strong Chinese GDP data (+6.5% in Q4). Both indices closed up +1% and the HIS made a new 11m high (short term resistance at 29169). Here in Europe, equities are all trading very mixed with a lack of direction overall (SXXP +0.1%). DAX currently outperforming its peers (+0.2%) after Armin Laschet was chosen as the new leader of Merkel’s CDU party. Volumes pretty poor across the board with indices trading -30% below their 30d AVAT.

Stimulus time? While Donald Trump became the first president impeached by the House twice (impeachment still set to be sent to the Senate for trial), it looks like Joe Biden is already working behind the scenes. Reports suggest that he is planning a $2 trillion stimulus package, boosting investors’ hopes this morning. EU indices are mostly trading up with cyclicals outperforming defensives. Note that taking a step back, they remain pretty much unchanged this week (SXXP -0.07% vs Friday’s close). Encouragingly though, the Stoxx VIX (V2X) finally dropped below 20, which would be a 10m closing low here (19.9 last). Keep an eye on it, if it closes here, it would be a new bullish signal in Europe.

Busier morning here at Redburn as more companies are starting to join the results party. Howden Joinery and Signify our highlight today with both companies surprising us with positive ad-hop updates. HWDN said profits are ahead (Dec-20E PBT indicated to be £185m, 12% above of ours/cons) and LIGHT pretty much reversed their pre-Christmas warning (one we really like here, read full commentary in the movers section above). We also heard from ASOS (UK the standout at +36% but EU and US less impressive in our view), and Persimmon (another mixed one, strong cash but slip in sites and margin).