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Morning Markets Report – Tuesday 19th October 2021

Major UK stocks were hampered by increased speculation over a Bank of England rate increase.

 

The main market focus over the past 24 hours has been inflation pressures and potential central bank responses, especially given supply-side pressures.

US yields overall moved higher, although long-term yields drifted lower. Reflation trades gained fresh traction on Tuesday with demand for commodities. Wall Street indices overall posted limited net gains with Asian equities also able to make headway.

Oil prices corrected lower with a WTI retreat from 7-year highs, but strong buying on dips. Precious metals recovered ground as the US dollar dipped lower. Bitcoin posted a fresh 6-month high.

Euro-zone equities lost ground on Monday amid fresh reservations over the outlook for Chinese demand and underlying concerns over the inflation outlook. Markets did pare losses late in the session as Wall Street rallied.

Major UK stocks were hampered by increased speculation over a Bank of England rate increase. Although high commodity prices offered support, there were reservations over the global outlook.

Wall Street stocks were hampered by underlying concerns over inflation and supply-side issues, especially with high bond yields, but equities were resilient with the S&P 500 index able to post a 0.3% advance.

US futures were little changed on Tuesday with Asian bourses able to make headway amid hopes for earnings resilience.

Japan’s Nikkei 225 index gained 0.6% with the yen weak on the crosses while there was a 0.1% decline for the Australian ASX index.

China’s Shanghai index traded 0.7% higher in late trading with a 1.4% gain for Hong Kong’s Hang Seng index.

 

 

Stock to watch today

SIG Plc continues to trade higher from the March 2020 lows. The sequence of higher highs and higher lows looks set to continue over the short to medium term. In recent months the price has consolidated around 43.15. The latest pullback to this level appears to be attracting fresh buying interest. This level also roughly coincides with 38.2% Fibonacci level. Some important reversal candles have formed in recent sessions, suggesting we may have reached a short term bottom. The close above the 10 Day Exponential Moving Average yesterday could trigger a fresh move to the upside.

 

CCM Opinion: BUY

Buy between 43.50 – 46p

Stop: 40.60p

Target: 65p

 

The value of shares can fall as well as rise; you may not get back the amount you invested. Past performance is no guarantee of future performance. Capital is invested at risk This document is published by Clear Capital Markets and does not constitute a solicitation or personal recommendation for the purchase or sale of investment. The investments referred to may not be suitable for all investors. Any data or views given should not be construed as investment advice. Every effort is made to ensure the accuracy of the information, but no assurance or warranties are given. Clear Capital Markets Limited is authorised and regulated by the Financial Conduct Authority FRN 706689.

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