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European Weekly Review
16 June 2014
             By S Gale, Analyst

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Europe Weekly Index Summary
Weekly ChangeP&F TrendStop
Euro Stoxx 332.758,322.3m-1.84-0.5% Bull 31 Mar 2014 312.50
Euro Stoxx 50 3282.843,117.2m-11.44-0.3% Bull 31 Mar 2014 3075.00
France CAC40 Index 4543.28501.3m-37.84-0.8% Bull 30 Jul 2012 4150.00
Germany DAX Index 9912.87365.8m-74.32-0.7% Bull 22 Apr 2014 9500.00
Netherlands AEX Index 414.05351.5m+0.79+0.2% Bull 9 Aug 2013 375.00
Spain IBEX 35 Index 11113.71,735.3m+49.40+0.4% Bull 31 Mar 2014 10200.00
Sweden OMX Index 1390.15363.6m-1.05-0.1% Bull 2 Apr 2014 1320.00
Switzerland SMI Index 8653.76138.6m-5.93-0.1% Bull 1 Apr 2014 8300.00
Closing prices last 5 days
European Macro Outlook

The European Indices have begun to consolidate from the major Pan-European Index resistance level at 350 and we note the SX5E reasserting a potential base against the SXXE with risk sentiment changes seeing larger cap stocks fall more in line with the general market.

We aim to keep a flat net position on our Model Portfolio, but the consolidation has seen a modest reduction to our net; we look to flatten our net with some possible profit taking and remain cautious with a defensive bias.

Stock Index

The Euro STOXX 50 (SX5E) consolidates from 3,300 with a potential 3,200-3,400 range.

The SX5E/SXXE ratio reasserts its medium term base formation.

The Euro STOXX (SXXE) consolidates to support at 320 with next resistance at 370.

Index Breadth
Our All-Europe % 10 and 30 week MA breadth indicators rallied into the top of the range at 80.
Sector Bulls & Bears

The Energy (SXEE) sector approaches resistance at 375 but also rallies from medium term relative base support; we anticipate a break.

The Autos (SXAE) and Banks (SX7E) sectors fail to make new highs and form relative tops.

The Utilities (SX6E) sector tests price and relative resistance whilst short term overbought.

Stock Action

We closed our short position in ENI as it broke to new highs and hit our stop. (10th June)

We took profits (15.52%) in our long position in Investor as it failed to make a new price high with a shooting star candle and developed a potential relative top, having become overbought. (10th June)

We opened a short position in Ryanair as it continued to develop price and relative top formations. We target 6.2 and placed our stop at 7.8. (12th June)

We opened a short position in Delhaize as it forms price and relative tops. We target 42 and place our stop at 54. (13th June)

Model Portfolio
Date Stock Code Type Open Price Current Price % P&L Stop Comment
21 Feb 2014 Total SAFP Long 45.6 52.86 +15.92%45
25 Feb 2014 GeberitGEBN Long 274.3 309.3 +12.76%255
4 Mar 2014 Swedish MatchSWMA Long 207.8 230.2 +10.78%195
14 Mar 2014 StatoilSTL Long 165.2 191 +15.62%154
17 Mar 2014 MichelinML Long 88.82 92.28 +3.90%83
21 Mar 2014 Norsk HydroNHY Long 29.01 33.55 +15.65%26.8
14 Apr 2014 L'Oreal SAOR Long 120.7 128.2 +6.21%115
17 Apr 2014 Casino GuichardCO Long 89.03 95.21 +6.94%81
22 Apr 2014 Orange SAORA Long 11.125 12.375 +11.24%10.3
24 Apr 2014 Schneider Electric SASU Long 68.38 69.09 +1.04%63
28 Apr 2014 Unilever NVUNA Long 30.53 32.32 +5.86%28.5
8 May 2014 UnibailUL Long 202.15 210.85 +4.30%190
14 May 2014 Roche Holding AGROG Long 269.3 266.3 -1.11%244
30 May 2014 Heineken NVHEIA Long 51.71 53.39 +3.25%48.5

Date Stock Code Type Open Price Current Price % P&L Stop Comment
8 Nov 2013 VallourecVK Short 42.17 34.2 +18.90%42
11 Dec 2013 Ebro PulevaEBRO Short 16.37 16.37 0.00%17.3
21 Jan 2014 OMV AGOMV Short 34.795 31.505 +9.46%36.8
31 Jan 2014 Deutsche Bank AGDBK Short 35.89 27.855 +22.39%37.6
13 Mar 2014 BNP ParibasBNP Short 56.44 51.5 +8.75%61
21 Mar 2014 Abertis Infraestructuras SAABE Short 16.225 16.68 -2.80%17.2
1 Apr 2014 PublicisPUB Short 64.57 62.35 +3.44%68
15 Apr 2014 ArcelorMittalMT Short 11.57 11.05 +4.49%12.7
22 Apr 2014 AholdAH Short 13.755 13.41 +2.51%14.6
25 Apr 2014 Continental AGCON Short 168.9 171.75 -1.69%182
27 May 2014 Renault SARNO Short 69.58 68.5 +1.55%74
29 May 2014 CRH PLCCRH Short 20.45 20.835 -1.88%22
2 Jun 2014 TeliaSoneraTLSN Short 49.2 49.27 -0.14%51
3 Jun 2014 ABB LtdABBN Short 21.08 20.94 +0.66%22
6 Jun 2014 VivendiVIV Short 19.24 19.2 +0.21%20.2
12 Jun 2014 Ryanair HoldingsRYA Short 7.311 7.112 +2.72%7.8
13 Jun 2014 Delhaize GroupDELB Short 50.98 50.98 0.00%54
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