Good morning Asia! Interesting movements were seen in the US session overnight as major US stock indices trimmed earlier losses. The S&P 500 halted its 5 day of losing streak & ended up +0.1% at the close after intraday -1.2%.
The worst hit big tech heavy Nasdaq 100 recorded intraday -3.5% breached below 13190/100 key MT pivotal support (12758 low) before it reversed back up to close at 13194. Medium term uptrend intact as dip buyers came in to support
Scorecard:
SP 500 $SPX +0.13%(3881)
Nasdaq 100 $NDX -0.22%(13194)
Dow Jones $INDU +0.05%(31537)
Russell 2000 $RUT -0.88%(2231)
The rising long dated Treasury yields are the main catalyst for the current softness seen in US tech/growth stocks.
The US Treasury 10-year yield $TNX seems to be taking a breather/consolidation now, -2bps to 1.35%. Formed a daily bearish reversal candlestick after it challenged the 1.38% major resistance in the prior US session. Technically, a potential 1-3 weeks of pullback for $TNX..
Where the tech heavy Nasdaq 100 $NDX may halt its recent 5 day of downside momentum.
Overall, it’s still cyclical/value stocks outperformance over tech as seen from yesterday S&P Sectors performance
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Good morning Asia! A sea of red for US stock market overnight. Even the outperforming cyclical/value stocks were not spared as traders took on a “sell everything” mindset due to a strong up move in long dated US Treasury yields..
Despite Fed Powell “assurance” that tapering of bond buying is likely not happening in the near to mid term.
Scorecard:
SP 500 $SPX -2.45%(3829)
Nasdaq 100 $NDX -3.56%(12828)
Dow Jones $INDU -1.75%(31402)
Russell 2000 $RUT -3.69%(2200)
As per highlighted earlier to watch the 1.38% major resistance on the US 10 year Treasury yield, it broke above 1.38% with a daily close at 1.53%, +15 bps, steepest single day gain since 4 Aug 2020.
Expected positive following through seen in the major US stock indices after its prior day of bullish reversal with cyclical/value plays continue to extend their outperformance that pushed the Dow Jones Industrial Average to fresh ATH (less weightage in tech stocks)
Scorecard:
SP 500 $SPX +1.14%(3925)
Nasdaq 100 $NDX +0.81%(13302)
Dow Jones $INDU +1.35%(31961)
Russell 2000 $RUT +2.38%(2284)
The worse hit $NDX has managed to reverse its initial loss of close to -1.69% when the 10 year US Treasury yield breached above 1.38% major resistance
The 10 year US Treasury yield $TNX printed an intraday high of 1.43% before closing at 1.38% which reinforced the recovery in $NDX & extended the gains for the rest of the US stock indices.
Hong Kong Exchanges & Clearing Ltd (HKEX) plunges the most by -9.3% since 2015 after a deleted news report that stamp duty on stock trades would be rise for the first time since 1993 to 0.13% to 0.1%.
This increased in HK stock trades stamp duty rumour has also dragged down the intraday performances of HK benchmark indices:
Hang Seng Index $HSI -1.9%(30045)
Hang Seng TECH Index $HSTECH -3.6%(9505)
It has been confirmed HKEX to hike stamp duty on stock trades from 0.13% to 0.10%. HKEX (0388) closed down -8.8% (509), its worst performance since 1993.