Evergrande in default of payment of obligations

Evergrande fell -14% in the stock market overnight as investors suspected the real estate developer would have a hard time paying a $ 82.5 million debt coupon today.

Asian Indices:

  • Australia’s ASX 200 Index rose 12.9 points (0.18%) and is currently trading at 7,254.10
  • Japan’s Nikkei 225 Index has lost -128.19 points (-0.46%) and is currently trading at 27,901.38
  • Hong Kong’s Hang Seng Index lost -300.3 points (-1.26%) and is currently trading at 23,466.39
  • China’s A50 index rose 148.44 points (0.95%) and is currently trading at 15,755.53

UK and Europe:

  • UK FTSE 100 futures are currently up 60 points (0.84%), the spot market is currently valued at 7,182.32.
  • Euro STOXX 50 futures are up 51 points (1.25%), the spot market is currently estimated at 4,131.15.
  • German DAX futures are up 153 points (1.01%), the spot market is expected to open at 15,322.98

US Futures:

  • DJI futures are currently down -59.72 points (-0.17%)
  • S&P 500 futures are up 18.5 points (0.12%)
  • Nasdaq 100 futures rose 22.5 points (0.5%)

On Friday night, Evergrande announced that creditors had requested about $ 260 million, so it was not sure if it could return a bond coupon of about $ 82.5 million today. Since this is the end of a 30-day grace period, the business will likely not pay this debt. The stock is currently trading around 1.97 and is expected to test its previous high of 1.83 set in May 2010.

US Futures Bounce

Sentiment improved overnight, allowing the US equity, oil, Australian dollar (AUD) and New Zealand dollar (NZD) futures markets to rise as the VIX rose. It’s unclear if this is just a pullback from Friday’s move or if investors are really looking on the bright side. However, the sentiment was not widely shared in Asia, with Chinese equity markets leading the way while Hong Kong indices fell more than 1%. Traders were bullish on China with expectations of a reduction in Beijing’s reserve requirement ratios, while stocks elsewhere lagged and followed bearish moves on Wall Street since Friday.

Australian dollar return above 0.70

The Aussie is the strongest currency overnight as traders repositioned after a week of heavy losses last week. AUD / USD is back above 0.70 but just barely. Friday was its most bearish session since May and closed below that key level on Friday and divergent central bank policies between the Fed and the RBA favor a weaker currency.

The USD / CHF pair is trying to form a bullish engulfing candle on the daily chart and is back above its 200-day moving average. This could be something to watch out for tomorrow as a daily close above 0.9222 also clears the monthly pivot point and warns of a potential swing downside.

GBP / AUD hit our target of 1.8870 after breaking above 1.8695 on Thursday. Considering that it has held up perfectly to the monthly pivot R2 and is now trading lower, we are happy to withdraw until a new opportunity presents itself.

FTSE 100 stumbles around 7200

ftse everlarge bag 06122021

On Friday, the FTSE 100 closed the day with a bearish pinbar below the monthly pivot point, with the 50-day moving average of the EMA acting as resistance. A break out of the low on Friday assumes that a tentative high has been seen and the bears may try again to target 7000. Interestingly, the futures market is pointing to a stronger open, but we would like to see a daily close above 7200 before have more confidence in future earnings. Until then, we prefer to mix with minor rallies in Friday’s range or wait for a breakout of its low.

evergande wallet 06122021

FTSE 350: 4,078.56 (-0.10%) December 3, 2021

  • 161 (45.87%) shares rose and 174 (49.57%) fell
  • 4 stocks hit a new 52-week high, 7 fell to new lows
  • 48.43% of the shares closed above their 200-day average
  • 45.58% of the shares closed above their 50-day average
  • 9.97% of shares closed above their 20-day average

Best results:

+ 3.20% -Vivo Energy PLC (VVO.L)
+ 2.71% -AJ Bell PLC (AJBA.L)
+ 2.56% -TBC Bank Group PLC (TBCG.L)

Low achievers:

-6.43% -John Wood Group PLC (WG.L)
-5.56% -Futur PLC (FUTR.L)
-4.56% -Discoverie Group SA (DSCV.L)

By Matt Simpson, » Official site

Disclaimer: The information and opinions in this report are provided for general information only and do not constitute an offer or solicitation to buy or sell currency or CFD contracts. Although the information contained in this document has been taken from sources considered reliable, the author does not guarantee its accuracy or completeness, and assumes no responsibility for any direct, indirect or consequential damages that may result from the fact that someone trusts such information.

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