Nasdaq 100 Forecast: NDX rises as oil eases and tech gains

US futures        

Dow futures -0.14%, S&P 500 futures -0.01%  & Nasdaq futures  0.20%

European futures

FTSE -0.29%,  DAX  0.38%

• US stocks rise recoverig from yesterday’s losses
• US 10-year Treasury yields ease as oil prices fall
• Anthropic IPO anticipation boosts the AI trade
• Oil falls as supply from the Middle East rises in September

U.S. Stocks Rise as Oil and Yields Ease

U.S. stocks are heading higher on Tuesday, helped by a pullback in oil prices and after details about Anthropic's IPO boosted sentiment towards tech stocks.

Oil prices have eased around 1% as the focus remains on improving supply in the Middle East, even though hopes of a diplomatic solution remain distant.

Today's recovery comes after the S&P 500 shrugged off its biggest one-day percentage fall since late August on Monday, as tech came under pressure and Treasury yields rose to fresh 19-year highs. With oil priceseasing today, yields are also falling.

A combination of high energy prices and strong U.S. economic data has boosted expectations that the Fed will hike rates in October. The market is pricing in a 70% chance of a 25-basis-point hike next month.

JOLTS job openings data is due shortly and is expected to show openings easing slightly to 7.23 million, down from 7.27 million in July. The data comes ahead of Friday's non-farm payroll report, which is expected to show another strong month of job creation.

Looking ahead, attention will also be on Fed speakers, with multiple officials speaking, including Christopher Waller and John Williams. Last week, Fed officials adopted a hawkish lean, which, combined with strong economic data, lifted rate-hike expectations.

Corporate Movers

AI stocks are rising after details about Anthropic's IPO boosted sentiment towards tech. Anthropic is targeting a valuation of over $2 trillion, potentially establishing it as a benchmark for how Wall Street values leading AI companies. Chip-related stocks are also rising pre-market following a sector-wide sell-off on Monday.

AMD is up over 1% after acquiring AI firm World Labs for $8.2 billion. The San Francisco-based AI lab is developing so-called world models, which researchers hope can help develop robots and other physically grounded AI applications.

SpaceX is rising over 1% after TD initiated coverage of the space company with a buy rating. Analysts pointed to growth in AI and space exploration as key drivers for SpaceX.

Nasdaq 100 Forecast – Technical Analysis

The Nasdaq 100 broke above its falling trendline resistance, rising to a record high of 30,800 before easing back. The price is consolidating around 30,400 and trades above its 200 and 50 EMAs, keeping the outlook constructive.

Buyers will look to rise above 30,800 to bring 31,000 into focus, ahead of 32,000 as the next logical target.

On the downside, immediate support can be seen at 30,300, the July high. Below here, 29,900 comes into focus as falling trendline support.

It would take a move below 28,900 for the outlook to turn more bearish, bringing 28,300 into focus, the June low.

FX Markets – Dollar Rises, EUR/USD Falls

The USD is rising to a two-month high against a basket of currencies, boosted by expectations that the Fed will hike interest rates as soon as October. Markets are pricing in around a 70% chance of a 25-basis-point hike in October. High oil prices combined with strong U.S. data are keeping Fed rate-hike expectations elevated.

EUR/USD is falling against a stronger U.S. dollar as the bond-market sell-off continues and after ECB President Christine Lagarde adopted a less hawkish stance in a speech overnight, indicating that higher long-term bond yields are already tightening financial conditions. She also noted a lack of second-round effects from higher energy prices, suggesting that the ECB could leave rates unchanged in October.

GBP/USD is falling against a stronger U.S. dollar, with pressure likely to remain given the BoE-Fed divergence. While the Fed is expected to remain more hawkish, sterling is struggling to gain ground even as markets price in around 100 basis points of BoE tightening over the next 12 months. The Bank of England may not need to tighten as much as markets expect given concerns over the labour market.

Oil Prices Fall as Supply Recovers

Oil prices are falling on Tuesday as investors focus on signs of recovering crude exports from the region, despite the ongoing Middle East conflict.

Brent is on track to gain around 16% this month, while WTI is up 7% across September.

Saudi Arabia has resumed oil loadings from its Red Sea port of Yanbu, helping ease supply concerns. Furthermore, data showed that crude exports from major Middle Eastern producers rose to 12.8 million barrels per day in September, the highest level since February.

Reports suggest that the U.S. and Iran have spoken separately with mediators in renewed efforts to end the seven-month war, although there appears to be little concrete sign of progress.

For oil prices to fall considerably, the market will want to see a further increase in supply or clearer signs that the U.S. and Iran are moving towards a ceasefire.