Stocks Rebound With Low Volatility
The global stock market rebounded followed by a sharp decline in the past week. However, the volatility in global stocks contracted compared to its recent past. Despite the negative news announcement “the second wave of the Covid-19 pandemic is accelerated” from WHO, the market swing ups and downs during the week due to the Investors seem positive by the fact the U.S President Trump has committed to not locking down the US economy for a second time and the rest of the globe is likely to follow.
Oil rallied and gains around 10% as weekly changes. Gold ended with a marginal weekly gain of 1%.
The NIFTY-50 Index outperformed within the APAC region. The major liquid indices from the APAC region gain a marginal weekly momentum of around 0.5 to 1.5%, whereas the European liquid Indices ended positively around 3% as a weekly gain due to the European investors looking for more stimulus to help the region’s nascent recovery amid concern about a fresh spike of Covid-19 infections.
We believe the market can be rebound further with the key positive news events like Fed announcement of the support of the credit markets, buying corporate bonds, consistency in decreasing jobless claims and an increase in retail sales. However, the ongoing US-China trade war, existing home sales on Monday, purchasing managers index on Tuesday and personal income and spending on Friday may alter the current trend and expectations or may reverse the direction.
We consider a past one-week news event and social media data to analyse the sentiment of the global market trends.
The following graphs show the news sentiment trend or the sentimental direction for the major global Indexes. Overall, the US market news sentiment is positive for the week. S&P-500 and Nasdaq-100 Indices showing the strong uptrend compare to its peers. Based on the news sentiment direction we can expect the US markets can rebound further in coming days.
The European and APAC region Indices showing the mixed in sentiment trend. CAC 40 and FTSE MIB can be expected to see the uptrend marginally. Whereas the Dax-30 and FTSE 100 showing strong downtrend sentiment.
The Nikkei 225, ASX-200 Indexes showing the strong uptrend in sentiment from the APAC region. On the other hand, Hang Seng Index shows a negative sentiment. Shanghai-50, Kospi-100 and Nifty-50 Indexes remain neutral.
Note: The sentiment indicator can be used as an additional overlay for your existing models to improve the performance further.
Buy & Sell Signals
The below table showing the buy/sell signals generated based on InfoTrie’s proprietary Investment/ Trading models. These models are developed with the combination of technical, fundamental, quantitative techniques and primarily the news-based sentiment score as an additional overlay.
I have tabulated the random signals from several InfoTrie’s Trading/Investment models.
The news sentiment score provides significant improvement, significant “Alpha” compared to the traditional investment/trading models.
For more details on the analysis, accessing complete tear sheets or white paper for the models, subscription details for News Sentiment data and other consulting works please contact us with the information provided below.