NASDAQ 100, HANG SENG, FTSE 100 INDEX OUTLOOK:Nasdaq 100 index prolonged losses, dragging the US inventory market sharply decreas
NASDAQ 100, HANG SENG, FTSE 100 INDEX OUTLOOK:
- Nasdaq 100 index prolonged losses, dragging the US inventory market sharply decrease
- Hong Kong’s Cling Seng Index noticed huge promoting in tech shares on the inclusion of Alibaba and Xiaomi
- UK’s FTSE 100 index can also retrace however at a comparatively smaller magnitude
Nasdaq 100 Index Outlook:
Nasdaq 100 index futures prolonged losses at Asia open after falling over 4% on Tuesday. Tesla shares tumbled 21%, marking the worst single-day efficiency recorded, weighing on the broader tech sentiment. A major retracement in expertise shares got here with no shock, as warning indicators got – wealthy valuation, deviation from the opposite sectors, US-China commerce spat, and rising volatility.
For now, the tech pullback appears extra like a technical correction in a mid-term bull market, as there are not any materials modifications noticed within the basic image. The US inventory market has maybe over-run and may even see a pullback. A technical correction often ranges between 5-20% in magnitude, past which alerts a bear market.
The subsequent query will probably be, to what extent will this tech correction affect the broader markets reminiscent of bonds, treasured metals, currencies and non-tech shares? The reply is it relies upon.
Beneficial by Margaret Yang, CFA
Prime Buying and selling Classes
The US Treasury yield curve was little modifications from every week in the past, and gold costs remained pretty composed. This would possibly recommend an absence of proof for systemic danger, a minimum of for now.
Crude oil costs, nonetheless, suffered a 7% decline because the US Greenback strengthened. The danger-sensitive AUD/JPY pairfell to a two-week low of 76.4, signaling that forex merchants are prioritizing for security.
Non-tech shares can also see spillover results from tech promoting and transfer decrease in Asia-Pacific and European buying and selling periods at present.
Sector-wise, all eleven S&P 500 sectors closed within the pink (desk beneath). Info expertise (-4.59%), vitality (-3.71%) and financials (-2.59%) had been among the many worst performers. Solely 9% of the S&P 500 index elements ended larger.
S&P 500 Index Sector efficiency 9-9-2020
Supply: Bloomberg, DailyFX
Technically,the Nasdaq 100 has damaged its “Ascending Channel” on Wednesday and thus has opened the room for extra draw back in the direction of 11,070 – the 23.6% Fibonacci retracement degree. A deeper correction could deliver it to check the subsequent key help degree at 10,220 – the 38.2% Fibonacci retracement. Its near-term momentum appears to be bearish-biased. The RSI indicator has swung sharply decrease to 38, however has but to achieve oversold territory beneath 30.
Nasdaq 100 Index – Every day Chart
Cling Seng Index Outlook:
Hong Kong’s Cling Seng Index (HSI) opened decrease following a massacre US buying and selling session. Throughout early Wednesday commerce, it was down over 1.3%. Chinese language expertise giants Alibaba (9988 HK) and Xiaomi (1810 HK) are formally added into the Cling Seng Index on ninth Sep 2020, which is able to considerably change the index’s tech weight. Each shares had been bought off closely because of the latest tech rout and an escalation in US-China commerce spat.
Technically, the HSI fell right into a bearish development just lately. Its rapid help degree may be discovered at 24,170 – the earlier low seen in early August 2020. Breaking this help will open room for extra draw back in the direction of 24,000 after which 23,500. The MACD indicator has turned firmly into the bearish zone, suggesting close to time period momentum biased in the direction of the draw back.
Cling Seng Index – Every day Chart
FTSE 100 Index Outlook:
Technically, the FTSE 100 index has examined a right away help at 5,800 and has since rebounded. Its rapid resistance degree may be discovered at 6,127 – the 50% Fibonacci retracement. Close to-term momentum appears to be biased in the direction of the draw back, as its 20- and 50-Day Easy Transferring Common (SMA) traces have shaped a “Loss of life Cross”. In comparison with the Nasdaq and different US inventory indices, promoting within the European inventory markets was a lot milder just lately.
FTSE 100 Index – Every day Chart
Beneficial by Margaret Yang, CFA
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— Written by Margaret Yang, Strategist for DailyFX.com
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