Morning Dew - 24 September 2013

Key Points

• JCI fell, tracking the falling Dow as comments from Federal Reserve officials brought uncertainties over the timing of the beginning of Fed's tapering. The rout reversed however, as the JCI ended at the top of its intraday trading range, albeit still incurring losses. China flash PMI estimate for September was the likely trigger as the preliminary reading showed a rise to 51.2 from August reading of 50.1. It was a six-month high, a good sign for the world's second-largest economy.
• Three Fed officials spoke recently and as the market searches for clues on the timing of the first move in reducing the stimulus, such speeches are to be followed closely. William C. Dudley from the NY Fed said that policy makers must 'forcefully' push against economic headwinds as the US economy has yet to show 'any meaningful pickup' in momentum. Elsewhere, Dennis Lockhart from Atlanta Fed said that monetary policy should focus on creating a more dynamic economy.  At the other point of view, Dallas Fed President Richard Fisher said that the Fed has harmed its credibility by failing to deliver the reduction last week.
• JCI fell to as low as 4512, just in between the EMA envelope of 4444-4545. We may see a limited attempt higher to retake the 4791.76 previous high but the attempt may be out of steam amidst the Fed uncertainties. On the other hand, the strong reading of Chinese PMI may lend support as the index may find it at around 4404.74. There is no more additional recommendations for now as the last two (AISA and ACES) remain unfilled.

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