Bullish rally in stock markets! | 12 June 2020

#WTI:

The US oil and gas rig count fell 17 in the week ended June 3 to 282, rig data provider Baker Hughes said, as oil-focused rigs continue to be pulled from fields. The total US oil and gas rig count has slid 63% from its most recent peak in early March, and is down over 70% from year-ago levels. US oil production averaged at 11.2 million b/d in the week ended May 29, US Energy Information Administration weekly estimates showed, down 1.9 million b/d from all-time high 13.1 million b/d in mid-March. However, the percentage of wells that will be profitable in a $35/b environment is not large. This is a positive signal for oil prices!

Trading recommendation: Buy 39.50 and take profit 41.10

#SP500:

Positive macroeconomic statistics from the United States are forcing investors to increase their long positions in the stock market. The Labor Department's closely watched employment report on Friday also showed the jobless rate falling to 13.3% last month from 14.7% in April. The survey of establishments showed nonfarm payrolls rose by 2.509 million jobs last month after a record plunge of 20.7 million in April. The CBOE Volatility Index, which measures the implied volatility of S&P 500 options, was down 5.00% to 24.52 a new 3-months low. This is a positive signal for investors!

Trading recommendation: Buy 3181 and take profit 3225.

#CAC40:

We are expecting an uptrend to develop. The Governing Council ECB decided to increase the envelope for the pandemic emergency purchase programme by €600 billion to a total of €1,350 billion. This is a positive signal for the French stock market! The horizon for net purchases under the PEPP will be extended to at least the end of June 2021. In any case, the Governing Council will conduct net asset purchases under the PEPP until it judges that the COVID-19 crisis phase is over. The Governing Council ECB is determined to ensure the necessary degree of monetary accommodation and a smooth transmission of monetary policy across sectors and countries.

Trading recommendation: Buy 5150 and take profit 5270.