Posted on June - 19 - 2010
Chinese Announcement Keeps Stocks On Track For Further Gains – RTTNews Daily Market Analysis
() - The major U.S. index futures are pointing to a sharply higher opening on Monday, with the optimism stemming from China’s assurance that it would soon relax its peg to the dollar. Equity markets across the globe relished the news and along with equities, commodities and risky currencies are also rallying. The Chinese announcement comes ahead of the G-20 meeting to be held over the weekend at Toronto and bodes well for world trade as a whole.
With the major averages having reclaimed a key resistance around their 200-day moving averages, they remain poised for further upside, especially in the wake of the Chinese announcement.
U.S. stocks extended their gains in the week ended June 18 despite showing indecision and uncertainty throughout much of the week, with the gains coming mostly in a single session, when skeptical traders showed excessive optimism in the face of fairly robust economic data.
Last Monday, the major averages remained solidly higher for much of the session, an extension of the buoyancy witnessed in the previous week. However, selling in late trading following a downgrade of Greece’s credit rating sent stocks lower. The major averages posted solid advances on Tuesday, with all three of them rising over 2% after the New York Federal Reserve’s survey showed that manufacturing activity in the region continued to expand at a pace that was expected.
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