GLOBAL STOCKS RALLY WITH A LOT OF HELP FROM EUROPE -- NASDAQ AND S&P 500 BOUNCE OFF SUPPORT LINES -- FREEPORT MCMORAN COPPER & GOLD LEADS STRONG MATERIAL SECTOR HIGHER
EUROPE LEADS GLOBAL STOCKS HIGHER... A strong performance in Europe is helping propel global stocks higher today. Chart 1 shows Europe 350 iShares (IEV) gaining 1.7% after recently bouncing off its 50-day average. That also puts the IEV in position to exceed its spring high for the second time in a month. Chart 2 shows the Euro also rallying to the top of a short-term consolidation pattern above its 200-day average. The combination of strong European stocks and a rising Euro (falling dollar) is giving a boost to global stocks.
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Chart 1
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Chart 2
S&P 500 BOUNCES OFF 50-DAY LINE... Chart 3 shows the S&P 500 bouncing off two initial support lines. The first is the horizontal support line drawn over its spring high. The second is the 50-day average (blue arrow). The Nasdaq has been in a deeper pullback of late. Chart 4, however, shows the Nasdaq Composite bouncng off a rising support line drawn under its June/July lows (green arrow). The Nasdaq is trying to regain its 50-day line.
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Chart 3
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Chart 4
FREEPORT MCMORAN COPPER & GOLD LEADS MATERIALS HIGHER... Material stocks are among the day's biggest gainers. Chart 5 shows the Materials Sector SPDR (XLG) gapping more than 2% higher and close to exceeding its spring high. Its relative strength line (below chart) also looks to be turning higher. Chart 6 shows Freeport McMoran Copper & Gold (FCX) has been consolidating above its 200-day average for the last month. The metal stock has also broken a major resistance line drawn over its 2011/2012 highs. Its relative strength line is turning up as well.
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Chart 5
