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Saturday, May 18, 2024

Nasdaq futures drop on Netflix’s tech impact

Tech giants’ disappointing earnings dampened market sentiment on Thursday, raising doubts about the Nasdaq 100’s impressive performance in the first half of the year. Nasdaq 100 futures dropped by 0.7% as Netflix Inc experienced its biggest intraday decline since December, missing sales estimates and providing a weak third-quarter revenue projection.

Investors are cautious amid a remarkable Nasdaq rally, which has seen a 45% surge this year, outpacing the S&P 500’s 19% rise, driven by excitement over artificial intelligence prospects. However, some experts, like Aegon Asset Management strategist Cameron McCrimmon, warn that this surge, primarily based on a few tech stocks, may be excessive and could signal an impending downturn.

Adding to the concerns, predictions of a US recession persist due to central banks tightening policies until inflation reaches their 2% targets. European tech stocks, including ASML Holding NV, slumped following Taiwan Semiconductor Manufacturing Co’s downgraded outlook. On the other hand, Anglo American Plc’s positive second-quarter results offset some of the equity market declines.

Amid inflation worries, investors also pondered the potential impact of agricultural commodities. Wheat prices spiked significantly after Russia warned that ships heading to Ukraine might be seen as carrying arms.

The dollar faced weakness against other major currencies, while the offshore yuan outperformed in Asia as the People’s Bank of China intervened with a yuan daily fixing bias not seen since November.

China’s efforts to revive growth, including rate cuts and regulatory adjustments for tech firms, have yet to make a significant impact on the world’s second-largest economy.

In the US market, S&P 500 futures fell 0.2%, Nasdaq 100 futures fell 0.7%, and Dow Jones Industrial Average futures remained largely unchanged. The Stoxx Europe 600 index rose 0.2%, and the MSCI World index showed little change.US stocks: Tesla, Netflix pull Nasdaq and S&P lower, Dow ends higher

The Bloomberg Dollar Spot Index declined 0.1%. Other currencies like the euro, British pound, and Japanese yen showed mixed movements against the dollar. Bitcoin rose 1.3% to $30,367.09, while Ether rose 1.1% to $1,920.36.

The yield on 10-year Treasuries increased by four basis points to 3.79%. Germany’s 10-year yield remained relatively stable at 2.44%, and Britain’s 10-year yield held steady at 4.22%. West Texas Intermediate crude rose 0.1% to $75.46 a barrel, and gold futures rose 0.2% to $2,022.70 an ounce.

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