Nasdaq 100 Rebounds as Tapering Fears Ease, Grasp Seng and ASX 200 Climb

NASDAQ 100, HANG SENG INDEX, ASX 200 INDEX OUTLOOK:

• Dow Jones, S&P 500 and Nasdaq 100 indexes closed +1.76%, +1.40% and +0.62% respectively
• Cyclical-linked power, financials and industrial sectors underperformed as inflation fears abated
• Futures in Japan and Australia are edging increased, main a rebound amongst APAC markets

Nasdaq 100, Powell’s Remark, USD, Bitcoin, Asia-Pacific at Open:

Wall Avenue shares rebounded strongly on Monday after Fed Chair Jerome Powell’s written feedback boosted market confidence. He mentioned inflation had picked up however ought to transfer again to the central financial institution’s long-term goal of two p.c as soon as provide imbalances resolve. It means that the latest spike in inflation could also be “transitory” and thus the Fed could also be affected person in elevating rates of interest. Powell’s dovish stance helped to alleviate market fears about tapering after St. Louis Fed President James Bullard hinted that price hikes could begin as quickly as ultimately of 2022 throughout a TV interview on Friday.

All 11 S&P 500 sectors ended increased, with reflation-linked power (+4.29%), financials (+2.35%) and industrials (+2.21%) outperforming. The Nasdaq 100 index closed a hair under its all-time excessive of 14,163, lifted by large-cap shares corresponding to ASML (+1.43%), Alphabet (+1.42%) and Apple (+1.41%). The upcoming earnings season may present the inventory market one other increase as analysts forecasted a stable interval of earnings progress. This will pave the way in which for Nasdaq 100 to aim increased highs within the weeks to return.

Supply: Bloomberg, DailyFX

The DXY US Greenback index pulled again 0.5% from a two-month excessive in a single day, assuaging stress on commodities and sending crude oil costs to their highest ranges seen since October 2018. Robust crude oil costs could bolster the attraction of commodity-linked currencies such because the Canadian Greenback and Norwegian Krone. Gold costs additionally rebounded mildly, however the total pattern seems to have tilted to the draw back after the latest selloff.

Bitcoin fell greater than 11% during the last 24 hours to the 31okay space after Chinese language authorities tightened restrictions in mining the digital token. Many Bitcoin mines had been closed within the Sichuan province over the weekend amid an intensified crackdown in opposition to the cryptocurrency. Greater than 90% of the nation’s mining capability can be shut down within the close to time period, which can have a major influence on costs as China accounts for round 70% of the world’s Bitcoin mining capability.

Asia-Pacific markets look set to commerce increased at this time. Futures in Japan, Australia, Hong Kong, Taiwan, Singapore and India are within the inexperienced, whereas these in mainland China, South Korea and Malaysia are within the pink.

Hong Kong’s Grasp Seng Index (HSI) underperformed regional friends not too long ago after President Joe Biden banned funding in a widened checklist of 59 Chinese language corporations with alleged ties to the protection or surveillance expertise sectors. Alibaba and Tencent ADRs fell 0.58% and 1.80% respectively in a single day, buying and selling at small reductions to their Hong Kong listings. This recommend that financials shares could outperform expertise ones at this time.

Australia’s ASX 200 index opened 0.66%, led by financials (+1.08%), supplies (+0.98%), utilities (+0.77%) and knowledge expertise (+0.54%) sectors. The index could additional profit from a rebound in metallic costs because the US Greenback retreated from a two-month excessive.

Nasdaq 100 IndexTechnical Evaluation

The Nasdaq 100 index breached a key resistance degree of 14,013 and thus opened the door for additional upside potential. Costs could intention increased highs within the days to return as the general pattern stays bullish-biased. The earlier resistance has now turn into an instantaneous assist. The MACD indicator is trending increased, suggesting that upward momentum is prevailing.

Nasdaq 100 Index– Day by day Chart

Grasp Seng Index Technical Evaluation:

The Grasp Seng Index did not breach the neckline of the “Double Backside” pattern and has since entered a technical pullback. Costs could proceed to vary certain between 28,300 and 29,350 ready for recent catalyst. The MACD indicator is trending decrease, suggesting that momentum could also be tilted to the draw back.

Grasp Seng Index – Day by day Chart

ASX 200 Index Technical Evaluation:

The ASX 200 index pulled again from its all-time highs this week and entered a technical correction. Quick assist ranges may be discovered on the 20-day SMA line (7,234) after which 7,200 – the 127.2% Fibonacci extension. The general bullish pattern stays intact as prompt by the upward-sloped SMA strains. The MACD oscillator shaped a bearish crossover nonetheless, suggesting that bullish momentum could also be fading.

ASX 200 Index – Day by day Chart

— Written by Margaret Yang, Strategist for DailyFX.com

To contact Margaret, use the Feedback part under or @margaretyjy on Twitter