Chinese economic numbers were as strong as they can get *Investors worried about the current support from PBOC *WTI may cross $66
Good news isn’t good anymore, especially today. European markets have decided not to celebrate the strong economic data out of China. The Chinese GDP number was healthy (Actual 6.4%, Est 6.3%), even the industrial production numbers were rock-hard: actual 8.5 percent while the forecast was 5.6 percent. This is as good as it can get.
Nonetheless, investors have a different view on this. The concern is that the People Bank of China may change its stance towards its monetary policy- we may not see that much support from the PBOC. The truth is that the handoff from feeble economic numbers to strong economic numbers is here and this is good news. Let's not forget, improving economic conditions over in China means better economic health of the global economy.
In terms of Year to Date market performance, the Shanghai Composite’s performance is notable, we are up over 30%. None of the major benchmark indices over in Europe and in the United States have similar performance. This is despite the fact that throughout this year, we had serious alarms ringing about the economic slow down in China.
I am not saying that the performance of the US and European indices aren't applaudable, the Nasdaq index is up 20% year to date- the leading index over in the US. The CAC 40 index is up 16.87 percent YTD and the Dax index is up 14.61 percent.
In terms of commodities, the black gold, WTI is back in the positive territory due to a surprise drop in the crude inventory data released yesterday. This was the first drop in nearly 4 weeks. This surprise drop has supported the price momentum. WTI is trading at 64.46 and the current momentum shows that it is likely that the price may go above the previous resistance of 64.70 formed on the 10th of April. Looking at the daily chart, the next resistance is at 66.42 while the support is at 62.99.
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