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Morning Markets Report – Tuesday 26th October 2021

Wall Street equities posted net gains with the S&P 500 index at a fresh record high amid a Tesla surge.

Central bank expectations tended to dominate on Monday with no major data releases. Risk appetite held steady with markets monitoring inflation trends closely. US Treasuries and bond yields were little changed during the day.

Wall Street equities posted net gains with the S&P 500 index at a fresh record high amid a Tesla surge.

Asian equity markets overall struggled to make headway with a retreat in China.

The dollar posted net gains on expectations that the Federal Reserve would confirm a tapering of bond purchases next week.  EUR/USD dipped below 1.1600 on dovish ECB expectations before settling close to this level. Sterling was resilient with firm risk conditions and EUR/GBP posted net losses.

Commodity currencies were mixed with solid AUD buying on dips as risk conditions and domestic expectations provided support.

Oil prices were subjected to a significant correction, but underlying demand persisted.

Euro-zone equities were hampered by concerns over weakening German business confidence with supply-side pressure also undermining confidence. Market conditions were benign, however, and bourses were able to make limited headway.

The German DAX index gained 0.35%, but there was a marginal loss for the Eurostoxx 50 index.

Major UK stocks were supported by strength in the commodities sector. Unease over a potential Bank of England rate hike curbed support to some extent, but the FTSE 100 index posted an 18-month high with a 0.25% advance.

Earnings optimism continued to underpin US equities on Monday and there were strong gains in the tech sector led by a surge in Tesla. Despite inflation concerns, the S&P 500 index gained 0.45% to a fresh record high.

US futures held firm on Tuesday and Japan’s Nikkei 225 index gained 1.8% as the yen weakened again.

Other Asian bourses were unable to make headway with only a marginal advance for the Australian ASX index. China’s Shanghai index traded 0.2% lower in late trading with Hong Kong’s Hang Seng index 0.7% lower.


Stock to watch today


Dominos Pizza has corrected lower in recent weeks, but remains within a long term uptrend. The shares have fallen to a 50% Fibonacci support level at 366p, which appears to have found some support. The close above the 10 Day Exponential Moving Average could trigger bullish momentum in the short term. Further upside is expected from here.


CCM Opinion: BUY

Buy between 375 – 385p

Stop: 359p

Target: 440p

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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