The S&P 500 and Dow Jones ended Friday +0.24% and -0.04% respectively in what was a rather mixed session for global equities. The haven-linked US Dollar and similarly-behaving Japanese Yen trimmed some of their gains during the North American trading session. This is also as the sentiment-linked Australian Dollar and New Zealand Dollar regained some lost ground from early on.
S&P 500 Technical Analysis
The S&P 500 has been struggling to push through the peak from April. This makes for a range of resistance between 2944 – 2965. Negative RSI divergence is present and that is a sign of fading upside momentum which could precede a turn lower. If that is the case, immediate support seems to sit below at 2908 followed by 2823.
· Hong Kong shares ease on China-U.S. rift, dollar firms
Hong Kong shares extended losses and a gauge of Asian stocks was largely subdued on Monday, after China’s move to impose a new security law on Hong Kong heightened concerns about the future stability of the city and global trade prospects.
Hong Kong’s HSI index fell 0.4% after sinking 5.5% on Friday, when Beijing proposed the new security legislation that sparked protests across the island over the weekend.
The broader MSCI’s index of Asia-Pacific shares outside Japan was 0.3% higher on thin volume, with South Korea, Australia and New Zealand all trading higher.
· Tokyo shares gain on reopening hopes; air, land transport companies shine
Japanese stocks advanced on Monday as the government looked set to end the state of emergency in Tokyo and surrounding areas, raising hopes that the world’s third-largest economy may soon start recovering from recession.
The benchmark Nikkei average rose 1.7% to 20,741.65, its best finish since March 6, with air and land transport shares leading the rally.
Japan plans to hold a government task force meeting later in the day to decide whether to lift state of emergency measures in Tokyo and four other prefectures, including the northern island of Hokkaido, which are still under restrictions.
Getting greater Tokyo, which accounts for about one-third of Japan’s gross domestic product, back on its feet is vital to the country’s overall economic recovery.
The broader Topix gained 1.7% to 1,502.20, also its highest close in 2-1/2 months, with all but one of 33 sector sub-indexes on the Tokyo exchange finishing higher.
· China stocks end higher as consumer sector lends support, U.S. tensions cap gains
China stocks closed higher on Monday, lifted by gains in consumer companies, though their rise was capped by simmering Sino-U.S. tensions.
The Shanghai Composite index rose 0.15% to 2,817.97.
The blue-chip CSI300 index was up 0.14%, while its financial sector sub-index fell 0.01%, the consumer staples sector gained 2.19%, the real estate index rose 1.56% and the healthcare sub-index added 1.31%.
· European markets higher as gradual reopening continues
European equities traded higher on Monday as countries move forward with gradual plans to reopen their economies and lift coronavirus lockdown restrictions. The French CAC 40 was up about 28 points in morning trading at 10 a.m. in Paris while Germany’s DAX index was up 100 points.
U.S.and U.K. markets are closed Monday for Memorial Day and the U.K. spring bank holiday, respectively.
Reference: CNBC, Reuters, Daily FX
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