US open: Dow looks to record highs, SNAP, Intel weigh on Nasdaq
Fiona Cincotta October 22, 2021 1:49 PM
Dow loks to record highs whilst the tech heavy Nasdaq comes under pressure as SNAP, Intel tumble.
Dow futures +0.23% at 35677
S&P futures +0.1% at 4554
Nasdaq futures -0.22% at 15453
FTSE +0.65% at 7233
Dax +0.8% at 15600
Euro Stoxx +1.00% at 4199
Nasdaq slips as Snap & Intel disappoint
US stocks are set to open mixed with the tech sector under pressure and the tech heavy Nasdaq under performing its peers.
The Dow Jones has extended its rebound off the 200 day moving average at the start of the month and powered to fresh all time highs. The Nasdaq on the other hand, trades 1.5% off that record level. A double whammy of bad news for the tech sector could well mean that record highs are out of reach for now.
Intel have tumbled 10% pre-market after disappointing Q3 sales. Component shortages are hampering sales of the semiconductor’s flagship chip processor. Adding to the bad new the chipmaker predicts lower margins for years to come. The depressing update left investor little choice but to jump ship.
Separately big names such as Facebook and Alphabet were also tanking lower following earnings from SNAP. Whilst EPS beat forecasts at 17c vs 8c expected, revenue fell short of expectations at $1.07 billion vs $1.10 billion forecast. SNAP blamed the impact from Apple’s privacy changes. Few companies were willing to spend big on advertising without the comfort of underlying analytics.
Despite weakness in tech, overall earnings have been upbeat contributing to the risk on mood in the market.
Looking ahead Federal Chair Jerome Powell is due to speak and investors will be watching closely for clues on when the Fed might start raising monetary policy. October PMI data will also be under the spotlight.
Where next for the Nasdaq?
The Nasdaq extended its rebound from the rising trendline support pushing back over its 100 sma and 50 sma. The retaking of resistance at 15400 and the bullish RSI keeps the buyer optimistic of further upside toward 15500 the weekly high and on to 15700 and fresh all time high. A fall below the 50 sma at 15200 could negate the near term uptrend. A move below 14600 could see sellers gain traction.
FX – EUR capitalizes on weaker USD
The US Dollar is falling on safe haven outflows. The upbeat mood in the market after solid PMIs in Europe and Evergrande narrowly missing default are dragging on demand for the greenback.
GBP/USD is struggling to gain ground after retail sales disappointed, unexpectedly declining -0.2% MoM, analysts had forecast a 0.5% rise. However, both services and manufacturing PMI data beat forecasts in September, despite supply chain issues.
EUR/USD is gaining, capitalizing on the weaker USD and finding support from better than forecast composite PMI data which only ticked mildly lower in October to 58.5, from 58.6 in September. German industrial production was encouraging strong.
GBP/USD -0.02% at 1.3800
EUR/USD +0.14% at 1.1640
Oil set for 9th straight week of gains
Oil prices are paring earlier losses and pushing higher on Friday. Oil trades around multi-month highs and is set to book its 9th straight week of gains.
Prices remain well supported by concerns over high coal nd has prices and shortages of these commodities in China, India and Europe which have prompted some power generators to switch to using oil.
However, winter is expected to be warmer than usual in the US and China is planning on intervening in the coal market to bring down prices, which is keeping a lid on gains in oil.
Looking ahead US Baker Hughes rig count data is due to be released.
WTI crude trades +0.67% at $82.93
Brent trades +0.6% at $84.70
14:45 US manufacturing & services PMI
17:00 Baker Hughes rig count
How to trade with FOREX.com
Follow these easy steps to start trading with FOREX.com today:
- Open a Forex.com account, or log-in if you’re already a customer.
- Search for the market you want to trade in our award-winning platform.
- Choose your position and size, and your stop and limit levels.
- Place the trade.
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.