Daily stocks and macro update: FTSE 100 unlikely to break above 6500, DAX snap to the downside possible below 10840

Nick Batsford, CEO of Tip TV, was joined by Zak Mir, technical analyst for ShareProphets.com, and Bill Hubard, Chief Economist for Bullion Capital, on the Tip TV Finance Show to discuss the future for the major Indices and stocks, as well as looking at ECB policy, EUR/USD and UK employment data.

No clues for the ECB future

Batsford highlighted Elliott, who noted that at yesterday’s open forum hosted by the BoE at the Guildhall, Mario Draghi, head of the ECB, gave no clues as to what the central bank might do at their next meeting. Insiders suggest it is considering extending its QE programme to include municipal as well as sovereign bond buying, entities like the City of Paris or the State of Bavaria, though this is unlikely to be rolled out it time for their 3rd December meeting. UBS Chairman Axel Weber thinks they will take their key rate down another 10 basis points into negative territory though Adam Posen, president of the Peterson Instit ute, thinks the recent exchange rate weakness has already done enough to help. Meanwhile 2-year German Schatz paper yields a record low of minus 35 basis points.

Index and Stock Outlook

Batsford outlined the S&P 500 which encountered moderate resistance at the previous high of 2130, with retracement being mild and another attempt at 2130 is promising.

In terms of the DAX, he commented that it continues to test resistance at 11000, with a breakout above this level and the descending trend line suggesting a test of 12400. Mir noted 10840 as a key level, and a break below this could result in a snap to the downside.

Mir believed that Rolls-Royce is looking for 450, with a painful fall ahead after experiencing a dead cross in July.

When concerning OPTI, he expressed that it is one of the best performing stocks of the year, and has jumped drastically, and is now looking for 100p.

Watch the video to see more technical analysis on further stocks and indices including the FTSE 100, the Nikkei 225, Tullow Oil, SMA and many more.

EUR/USD – inverted head and shoulders failure

Batsford highlighted FX Street, who believed that the EUR/USD is in a 100-pip range between 1.0680 and 1.0780, with a failure to break out from the inversed head and shoulder pattern increasing the odds of a bearish break out of this range. They continued that the EUR/AUD also dropped below the 50% Fib level of the 2015 rally, whilst EUR/CAD fell below the 50% Fib as well. In terms of the EUR/NZD, it could drop below the 50% Fib level from its 2015 rally at 1.6218.

UK employment at new highs

Batsford noted Elliott, who believed that in the three months to September UK employment rose to a new record high of 31.21 million, or a rate of 73.7% and the highest since these records began in 1971. Meanwhile unemployment dipped to 5.3% from 5.6% in Q2 2015, the lowest since April 2008. Average earnings growth dropped back to 2.5% though when bonuses are included it’s running at 3.0%.

AB InBev and SAB Miller

Batsford outlined that ABI are to acquire SAB Miller for $107 billion, which comes to &67 per share, and this gives AB InBev access to many emerging markets.

Tags: ECB, BoE, Bank of England, Draghi, central bank, QE, rate hike, interest rates, S&P 500, DAX, Rolls-Royce, OPTI, FTSE 100, Nikkei 225, NASDAQ 100, VIX, Tullow Oil, SMA, CEY, GLEN, SBRY, Diageo, XLM, EUR/USD, EUR/AUD, EUR/CAD, EUR/NZD, UK, employment, unemployment, SAB Miller, AB InBev