Elections were held in Brazil in early October, during which Flávio Bolsonaro, the challenger to incumbent President Lula, performed better. The second round of the presidential election will follow in late October, when it will be decided which of the two will become Brazil’s next president. Currently, Flávio Bolsonaro appears to be the favorite to win, and based on market reactions, investors may already started pricing in this scenario. If Flávio Bolsonaro is elected president, it could pave the way for the fiscal turnaround anticipated by market participants, and relations between Brazil and the United States could also improve, which over time could even lead to lower Brazilian tariffs.
Südzucker, which is one of the world’s largest sugar producers and a leading player in European biofuel production, released its latest interim report, which contained both pleasant and slightly negative surprises. On the one hand, there has been a significant improvement in financial performance on an annual basis, three out of five business segments posted excellent results, and losses in the sugar production division also narrowed thanks to cost-efficiency measures. On the other hand, management raised its annual forecasts only moderately despite strong business performance, which may have disappointed some investors. However, in our view, the outlook for the sugar market remains favorable, so the sugar production segment’s profitability may improve in the coming period. Overall, we are keeping the stock on our Equity Top Pick List.
Among U.S. indices, the S&P 500 and the Nasdaq are still in an uptrend, but it wouldn’t take much for those uptrends to break. Given the high price levels near all-time highs, increased risk management is recommended. In contrast, the Russell 2000 had already been looking weak, and the past few days have done nothing to change that. The DAX and the Stoxx 600 have reached strong support levels, but their downtrends have not yet broken, and they have not yet formed higher lows. The index tracking emerging markets continues to move within a range; a breakout from this range could trigger more significant price movements.
The index is still in an uptrend, remaining above the trendline but below the key level of 7,813. As long as the trendline holds, a new high is possible. A close below 7,653 could trigger a correction phase and potentially break the main green uptrend line. However, if the uptrend holds, the strong resistance level at 8,125 could be reached above 7,813.
Resistance levels: 7,813; 7,969; 8,125; 8,438
Support levels: 7,188; 6,875; 6,563; 6,250; 5,938.
Since the breakout, it has remained above the new uptrend. A new high was reached, though it did not break out significantly higher. Above, 31,250 is considered the first major resistance level, while below, 29,688 is considered support following the breakout. If the index closes back below 30,470, it could trigger a downward reversal; at the same time, it’s advisable to manage risk on the long side at this level.
Resistance levels: 31,250; 31,640.
Support levels: 30,470; 29,688; 28,906; 28,125; 27,344; 26,562.
The small-cap index has shown a completely different picture in recent weeks. Its decline reached the first expected support level around 2,813. The natural level of 2,969 has now become a resistance level, but Friday’s rebound may be able to stall the downward momentum. Ideally, the decline could extend as far as halfway down the previous uptrend, which could lead to a test of 2,734 or 2,656. Therefore, there are currently no signs pointing toward a buying opportunity.
Resistance levels: 2,969; 3,043; 3,125.
Support levels: 2,813; 2,734; 2,656; 2,578; 2,500.
The area around the 25,000 level has proven to be a support level so far, but for a multi-week uptrend to begin, a higher low would need to form, and the price would need to close above the red trendline for at least two days. Even so, the potential return does not seem attractive. On the other hand, a break below the 25,000 level could open up further downside potential. The price could fall all the way to the next support level at 24,218. A drop to the previous breakout point at 23,438 is also a possibility.
Resistance levels: 25,781; 26,562.
Support levels: 24,218; 23,438; 22,656.
It reached the first minor support level at 625 last week; for now, we’re seeing a bounce from there, but a sustained reversal would require a lower low. If the reversal doesn’t happen, there would still be room to fall, as the price could be expected to decline to at least halfway down the strong uptrend. This would mean the price could drop as low as 609 points. The red downward trendline is pushing the curve downward; as long as the chart remains below it, the movement may remain in a correction phase.
Resistance levels: 671.88; 687.5.
Support levels: 625; 594; 578; 562; 546.
Consolidation continued below the 68.75 level. The price is currently between 68.75 on the upside and 65.63 on the downside. A breakout from this range could trigger a stronger move. If the price moves downward, a trend-like decline could occur toward the first support level, which is expected around 62.5. If the price attempts to fill the gap above 68.75, 71.88 could be the first resistance level. It may be worth waiting to see which direction the price breaks out in.
Resistance levels: 68.75; 71.88.
Support levels: 62.5; 59.38; 56.25; 53.13; 50.
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