Skip to content

CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your deposits, so please consider our Risk Disclosure Notice and ensure that you fully understand the risks involved. CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your deposits, so please consider our Risk Disclosure Notice and ensure that you fully understand the risks involved.

Nasdaq 100 underperforms Dow Jones. ASX 200 at risk to hawkish RBA

The Nasdaq 100 underperformed on Wall Street relative to the Dow Jones; investors fled growth stocks as FOMC minutes underscored hawkish Fed and Australia’s ASX 200 vulnerable after RBA rate decision, China lockdowns.

Source: Bloomberg

Wednesday’s Wall Street trading session recap

Market sentiment soured on Wednesday during the Wall Street trading session. The Nasdaq 100, Dow Jones and S&P 500 futures weakened 2.18%, 0.05% and 0.04% respectively. In fact, it was the worst day for the Nasdaq relative to the Dow Jones in over three weeks. Capital fled growth stocks disproportionately relative to value ones. This continues to underscore the challenges investors face this year.

Looking at sectors within the S&P 500, consumer discretionary (-2.63%), information technology (-2.55%) and communication services (-2.11%) were the worst-performing segments. This did not mean that there were no losers on Wall Street. Utilities (+2.00%), real estate (+1.55%) and health care (+1.55%) outperformed.

Risk aversion plagued Wall Street as Treasury yields continued their ascent into new 2022 highs, driven by hawkish Federal Reserve policy expectations. The minutes of the March FOMC meeting revealed that policymakers are more than just open to 50-basis point hikes. This is as the central bank is expected to taper its balance sheet to the tune of USD 95 billion per month starting soon.

NASDAQ technical analysis

Nasdaq 100 futures may be vulnerable to near-term losses after the index appeared to confirm a breakout under a bearish Double Top chart formation on the four-hour chart. The neckline was taken out at 14725, exposing the 100-period Simple Moving Average (SMA). Immediate support appears to be the 38.2% Fibonacci retracement at 14380. Further losses may open the door to extending downward towards the March low.

Source: TradingView

Thursday’s Asia-Pacific trading session

Following the rather disappointing session on Wall Street, Asia-Pacific equities risk following the pessimistic tone that was set earlier. The economic docket is also light. Australia’s ASX 200 index will be an interesting one to watch following this week’s RBA rate decision which delivered a hawkish tilt. Russia’s attack on Ukraine is likely to boost European demand for Australian goods, perhaps boosting the latter’s economy.

However, China, which is Australia’s largest trading partner, has been enforcing draconian lockdown measures to contain an outbreak of the Omicron Covid-19 variant. Cases rose by almost 20k yesterday. This has been particularly impacting Shanghai, and economists have been downgrading 2022 growth expectations. This uncertainty may continue working against the ASX 200 in the near term.

ASX 200 technical analysis

Much like the Nasdaq 100, the ASX 200 may also be carving out a Double Top chart formation. The neckline appears to be around 7460. Clearing immediate support, which may be a combination of the 100-period SMA and the 23.6% Fibonacci retracement at 7415, may open the door to extending losses. This also follows negative RSI divergence, showing fading upside momentum.

ASX 200 4-hour chart

Source: TradingView

Follow Daniel Dubrovsky on Twitter @ddubrovskyFX

This information has been prepared by DailyFX, the partner site of IG offering leading forex news and analysis. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.


The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer.

Start trading forex today

Find opportunity on the world’s most-traded – and most-volatile – financial market

  • Trade spreads from just 0.6 points on EUR/USD
  • Analyse with clear, fast charts
  • Speculate wherever you are with our intuitive mobile apps

See an FX opportunity?

Try a risk-free trade in your demo account, and see whether you’re onto something.

  • Log in to your demo
  • Take your position
  • See whether your hunch pays off

See an FX opportunity?

Don’t miss your chance – upgrade to a live account to take advantage.

  • Get spreads from just 0.6 points on popular pairs
  • Analyse and deal seamlessly on fast, intuitive charts
  • See and react to breaking news in-platform

See an FX opportunity?

Don’t miss your chance. Log in to take your position.

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.