A positive week for the stock markets! | 20 November 2020

#ASX:

China's President Xi Jinping has called for further development of the Yangtze River economic belt as part of the country's "dual circulation" strategy. Xi first raised the concept of dual circulation in May this year, amid a rift with the United States, and later explained China would rely mainly on "internal circulation" - the domestic cycle of production, distribution, and consumption - for its development, supported by "external circulation." "Provinces and cities along Asia's longest river - which flows from west to east China - should promote "coordinated development" and "guide the orderly transfer of capital, technology and labour-intensive industries in downstream regions to upstream and midstream regions." Xi Jinping said. We are expecting an increase in demand for raw materials from China. This is a positive signal for the Australian stock index ASX, in which a significant share belongs to exporters of iron ore, coking coal, copper and gold.

Trading recommendation: Buy 6450 and take profit 6547.

#SP500:

Federal Reserve will conduct operations in the government bonds market, where it will buy US Treasury securities for $34.27 billion in this week. This will be the maximum volume this month. Surplus reserves of American commercial banks have increased by $ 8.8 billion, allowing bankers to continue speculating in the stock market. This is a positive signal for the stock market. M2 money supply renewed its istorical maximum and reached $ 18.89 trillion. The growth rate still exceeds 24.2% and is at an all-time high. We are expecting a continuation of the bullish rally in the new five-day period.

Trading recommendation: Buy 3600 and take profit 3670.

#WTI:

The U.S. oil and gas industry has been fretting about the implications of a Biden Presidency on the sector in view of Joe Biden’s energy plan to favor renewable development and ban new oil and gas leases on federal lands. Biden’s plan to fight climate change with a pivot to renewables and a pledge for net-zero emissions in the power sector by 2035, as well as a ban on fracking on federal lands, will impact the level of U.S. oil and gas production in the coming years. The oil and gas industry is “still an important source of tax revenue for certain states and a big employer – not least in New Mexico and Pennsylvania, key Democratic wins. There’s a delicate balance to be struck between nursing oil and gas through its current crisis and tightening the screws to align with the Democratic fossil fuel goals.

Trading recommendation: range 39.25 -41.20.