A strong decline in the number of stocks pushing indices to new highs, observes Ken Odeluga, Market Analyst, for City Index, as he joins today’s Tip TV Finance Show to discuss Fed rates, and the outlook for Nasdaq 100.
Same drum beat from the Fed
Odeluga maintains the view that the FOMC minutes saw the Fed utter the same thing as before. While the outlook for rates isn’t unchanged, the rise in EUR post the minutes release, hints at a dovish Fed.
The indices have recovered and the market is now used to the idea that rates are rising, adds Odeluga.
Indices plotting new highs, but reduction in width of the rally
Odeluga highlights that fewer stocks are now doing the heavy lifting for the major indices. He notes that there has been a historical reduction in the market breadth, and traditionally this leads to a weakening in uptrends and even a correction.
Nasdaq: Heading higher
Odeluga highlights the vulnerability in the Nasdaq, but maintains a bullish view on the tech heavy US equity market index.
On other major indices, he maintains a positive view on S&P 500 and the FTSE 100.