Weekly Updates 21/10/24 – 25/10/24 October 21, 2024
This weekly update is designed to help you stay informed and relate economic and company earnings to potentially value-add your CFD (Contract For Difference) trading via hedging (risk reducing). This article should be used for educational purposes only and not as financial advice. We urge all traders to carry out your own due diligence before submitting trades.
Recap for last week (14 Oct – 18 Oct 2024)
*These prices are taken based on the previous Monday’s opening price and the preceding Friday’s closing price.
Last week Wall Street finished on fresh highs where S&P 500, Nasdaq and DJI rose0.6%, 0.34% and 1.11% respectively, followed by solid company earnings released byNetflix (11% rise in sales) and Apple (1.2% rise in sales for its newest iPhones inChina). With last week’s stronger than expected US economic news on its weeklyjobless claims and Sep retail sales has supported the US stocks and improved theoutlook of the US economy looking for a soft landing.
Updates for the week (21 Oct – 25 Oct 2024)
The data below showing the economic releases read as “Analyst’s estimate/ Consensus | Previous data”.
This week ahead traders will pay attention to China’s interest rate decision on Mondaywhere the consensus is expecting 20 basis point reduction in 1 year and 5 year loanprime rates. However, this expectation has grown skeptical due to the momentaryrecovery in the Chinese stock market which was boosted by the stimulus measures.Initial Jobless claims will likely remain elevated as market participants are still affectedby the Milton and Helene Hurricanes, while Boeing also announced that it is planningto reduce it’s workforce by approximately 17,000 in the coming months. With decliningmortgage rates in Sep 2024, new home sales is expected to rise by 720k despite slowdemand for housing. Consumer sentiment is most likely to change near to the end ofOct as compared to early of the month’s data due to US election getting nearer at Nov5 with expectations for the future depends on the election results.
Earnings releases for this week focuses on Tesla from the magnificent 7, Phillip Morris, Boeing and UPS. With Tesla’s recent Robo Taxi event, investors were not impressed with both the progress and timeline given by Elon Musk, causing Tesla stock to drop~8%. Analysts and investors are eager to see any positive surprises from Tesla’s balance sheet and forward guidance for both Tesla as a company and EV as a sector. UPS’s earnings and forward guidance can be used as a proxy on the speed and volume of goods being exchanged in the economy. Traders and investors are advised to position their portfolio accordingly to reduce any negative effects of upcoming earnings release
For those looking to speculate or capitalize on the increased volatility, CFDs provide leverage and ease of going long and short across a broad range of products available. As CFD is traded on margin, there is a risk of losing more than your initial deposit amount and traders need to adopt proper risk assessment and management to determine if CFD is the product for you. If you hold equity positions in these stocks, you can hedge your positions using CFDs to mitigate the risk of disappointing earnings releases.
China Merchants Bank (3968.HK): Key Trading Level by Sean Ng
Key Entry Price Pivot(s)
- $39.3
Recommended Trade
- Long above $39.30
- Take profit at $47.30
- Stop Loss at $37.30
Alternative Case
- Short below $39.30
- Take profit at $35.50
- Stop loss at $41.60
Remarks
- 3968.HK has been rallying strongly, but has recently experienced a pullback to the key support level, $39.30
- Volume has also fallen as 3968.HK has pulled back, potentially indicating weakening sellers
- Traders can potentially seek to take a long trade is price rebounds off of support, or a short trade if price breaks below it
If you have any feedback or questions, feel free to email us at samht@phillip.com.sg or onishathyeyn@phillip.com.sg or cfd@phillip.com.sg.
Disclaimer
This material is provided to you for general information only and does not constitute a recommendation, an offer or solicitation to buy or sell the investment product mentioned. It does not have any regard to your specific investment objectives, financial situation or any of your particular needs.
Accordingly, no warranty whatsoever is given and not liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of your acting based on this information. Investments are subject to investment risks.
The risk of loss in leveraged trading can be substantial. You may sustain losses in excess of your initial funds and may be called upon to deposit additional margin funds at short notice. If the required funds are not provided within the prescribed time, your positions may be liquidated.
The resulting deficits in your account are subject to penalty charges. The value of investments denominated in foreign currencies may diminish or increase due to changes in the rates of exchange.
You should also be aware of the commissions and finance costs involved in trading leveraged products. This product may not be suitable for clients whose investment objective is preservation of capital and/or whose risk tolerance is low.
Clients are advised to understand the nature and risks involved in margin trading. You may wish to obtain advice from a qualified financial adviser, pursuant to a separate engagement, before making a commitment to purchase any of the investment products mentioned herein. In the event that you choose not to obtain advice from a qualifies financial adviser, you should assess and consider whether the investment product is suitable for you before proceeding to invest and we do not offer any advice in this regard unless mandated to do so by way of a separate engagement.
You are advised to read the trading account Terms & Conditions and Risk Disclosure Statement (available online at www.poems.com.sg) before trading in this product. Any CFD offered is not approved or endorsed by the issuer or originator of the underlying securities and the issuer or originator is not privy to the CFD contract. This advertisement has not been reviewed by the Monetary Authority of Singapore.
CFD Disclaimer
Investments are subject to investment risks. The risk of loss in leveraged trading can be substantial. You may sustain losses in excess of your initial funds and may be called upon to deposit additional margin funds at short notice. If the required funds are not provided within the prescribed time, your positions may be liquidated. The resulting deficits in your account are subject to penalty charges. The value of investments denominated in foreign currencies may diminish or increase due to changes in the rates of exchange. You should also be aware of the commissions and finance costs involved in trading leveraged products. This product may not be suitable for clients whose investment objective is preservation of capital and/or whose risk tolerance is low. Clients are advised to understand the nature and risks involved in margin trading.
You may wish to obtain advice from a qualified financial adviser, pursuant to a separate engagement, before making a commitment to purchase any of the investment products mentioned herein. In the event that you choose not to obtain advice from a qualified financial adviser, you should assess and consider whether the investment product is suitable for you before proceeding to invest and we do not offer any advice in this regard unless mandated to do so by way of a separate engagement. You are advised to read the trading account Terms & Conditions and Risk Disclosure Statement (available online at https://www.poems.com.sg/) before trading in this product.
Any CFD offered is not approved or endorsed by the issuer or originator of the underlying securities and the issuer or originator is not privy to the CFD contract.
This advertisement has not been reviewed by the Monetary Authority of Singapore.
This material is intended for general circulation only and does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should seek advice from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs, before making a commitment to invest in such products.
About the author
Sam Hei Tung (Assistant Manager, Dealing) and Onisha Thye (Dealing)
Sam graduated from National University of Singapore with a Master of Science in Finance. He personally manages his own investment portfolio and does equity and economic research in his free time. Sam believes that education and information is essential to making good financial decisions.
Onisha is a dealer at the CFD Dealing Desk. She graduated from Monash University with a double major in finance and econometrics. Her natural curiosity for finance is what drove her to be in this field as she is fascinated by all the possibilities and opportunities.
