FTSE 100, DAX 40 and Nasdaq 100 continue to advance cautiously
Outlook on FTSE 100, DAX 40 and Nasdaq 100 following last week’s positive start to the Q1 earnings season and weaker-than-expected US retail sales for March.
FTSE 100 rises for 8th consecutive day
Last week’s FTSE 100 break through the February-to-April downtrend line has led to the 7,900 region practically being reached with the early March high at 7,976 and the psychological 8,000 mark representing the next upside targets as traders await Tuesday’s UK employment data for February.
Minor support sits between the 7,876 to 7,854 January high and late February low and can also be spotted along the March-to-April uptrend line at 7,840.
While it underpins, further upside looks to be in store.
DAX 40 pushes for new 15-month high
The DAX 40 is expected to overcome last week’s 15-month high at 15,843 while tracking Wall Street higher after a positive start to the Q1 earnings season with the likes of JPMorgan reporting much better-than-expected earnings on Friday and as the reduction in rate hike probabilities continues to prop up valuations.
The psychological 16,000 mark is likely to be reached soon, above which lurk the November 2021 and January 2022 highs at 16,288 and 16,298.
Minor support below the March-to-April uptrend line at 15,794 can be found around the early April peak at 15,742 and the 15,709 early March high.
While last Thursday’s low at 15,657 isn’t being slipped through, upside momentum should continue.
Nasdaq 100 benefits from lower rate hike probabilities
On Friday the Nasdaq 100 had a minor wobble as US Q1 earnings season kicked off but then regained all of its intraday losses on a reduction in the Federal Reserve’s (Fed) rate hike probabilities as US retail sales fell by a more than expected 1% in March versus -0.2% in February and an expected drop of 0.4%.
Market players are now pricing in one more Fed 25-basis point fed funds rate hike to 5.00%-5.25%, followed by several months of unchanged rates.
The Nasdaq managed to briefly reach a high of 13,151 last week, a rise above which would lead to the early April peak at 13,226 being back in focus. This level was last traded in August 2022, an advance above which would target the 13,500 region.
Potential slips may find support along the March-to-April uptrend line at 12,954, ahead of the 10 April low at 12,857 and last week’s low at 12,819.
While the 12,819 level low holds, the March-to-April uptrend remains valid.
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