Market alert: as Nasdaq 100 extends recovery on Wall Street, will the ASX 200 and Nikkei 225 follow?
Nasdaq 100, tech stocks sink as another central bank becomes more hawkish; Australia’s ASX 200 vulnerable to Chinese lockdowns, slowing global growth and will China CPI data keep the PBOC on its toes amid stimulatory measures?
Thursday’s Wall Street trading session recap
Sentiment on Wall Street continued to improve, with Thursday’s price action adding to the recovery in stocks since the middle of June. Nasdaq 100, S&P 500 and Dow Jones futures are up about 4.5%, 3.11% and 2.25% this week so far respectively. On a monthly basis, the tech-heavy Nasdaq 100 is heading for its best performance since November 2020.
The rosy mood on Wall Street continued tracking what has been a relatively upbeat earnings season so far. On average, companies in the S&P 500 have surprised 1.01% and 4.43% in sales and earnings respectively – according to Bloomberg. Over the past 24 hours, the best sectors in the S&P 500 were consumer discretionary (2.25%), health care (1.51%) and information technology (1.41%). Energy (-1.69%) lagged with crude oil prices.
Further contributing to the cheery sentiment was, counterintuitively, worse-than-expected US jobless claims data. The two-year Treasury yield fell 4.34% on Thursday, the most since the middle of June. Meanwhile, market expectations of Federal Reserve rate cuts in 2023 increased. Traders are almost pricing in two by the end of next year. This likely sent stocks higher.
Nasdaq 100 technical analysis
The Nasdaq 100 continues to make upside progress after breaking above an Ascending Triangle chart pattern. Now, the index is quickly approaching key resistance. This seems to be a combination of the June high (12961) and the 100-day Simple Moving Average (SMA). If these hold, a pivot lower might be in the cards.
Nasdaq 100 futures daily chart
Friday’s Asia-Pacific trading session
Friday’s Asia-Pacific trading session is lacking notable economic data. This is placing the focus for traders on general risk appetite. As such regional indices, such as Australia’s ASX 200 and Japan’s Nikkei 225, may follow in the footsteps of Wall Street. That would set things up for a continuation in risk appetite heading into the weekend.
ASX 200 technical analysis
The ASX 200 has also confirmed a breakout above an Ascending Triangle. This is opening the door to further gains. The 50-day SMA is just above which may hold as resistance, perhaps pivoting the index lower. Otherwise, further gains expose the midpoint of the Fibonacci retracement at 7017.
ASX 200 daily chart
Nikkei 225 technical analysis
As for the Nikkei 225, the index finds itself sitting on a long-term falling trendline from the Fall of 2021. Breaking above may not leave things in the clear as the 28180 – 28455 resistance zone is nearby. Breaking above this zone would likely be the bullish confirmation of resuming gains since February.
Nikkei 225 daily chart
This information has been prepared by DailyFX, the partner site of IG offering leading forex news and analysis. This information Advice given in this article is general in nature and is not intended to influence any person’s decisions about investing or financial products.
The material on this page does not contain a record of IG’s 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.
IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.
The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.
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. Please see important Research Disclaimer.
Please also note that the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.
Take a position on indices
Deal on the world’s major stock indices today.
- Trade the lowest Wall Street spreads on the market
- 1-point spread on the FTSE 100 and Germany 40
- The only provider to offer 24-hour pricing
Live prices on most popular markets
- Forex
- Shares
- Indices
See more forex live prices
See more shares live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
See more indices live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.