Semiconductors spark market rebound 09/10/2024

HOT stories for today
09.10.2024.

Stocks on the move:

• DocuSign Inc. saw gains after S&P Dow Jones Indices announced that the e-signature company would be added to the S&P Midcap 400 Index before the market opens on October 11.
• PepsiCo Inc. adjusted its revenue forecast downward, pointing to slower growth and geopolitical uncertainties. However, the company remains confident it can achieve its profit targets through cost-cutting measures and improved efficiency.
• WW International Inc. revealed plans to introduce a more affordable alternative to weight-loss drugs, aiming to compete with Novo Nordisk A/S’s Ozempic and Wegovy.
• Nvidia’s stock is nearing an all-time high as Wall Street anticipates strong performance ahead. Analysts believe the high demand for Nvidia’s new Blackwell chip lineup will drive impressive results in the coming year.

Is MSFT in trouble?: 

• Microsoft Corp.’s stock chart is on the verge of flashing a bearish “death cross” signal, a pattern that’s been developing over the past few months. This occurs when the 50-day moving average crosses below the 200-day moving average, indicating a shift from a short-term dip to a potential longer-term downtrend.
• The last time Microsoft saw a death cross was in March 2022, after a 16% decline, and the stock subsequently fell another 45% over the next year. While the current pullback suggests a potentially deeper downturn—unlike previous reversals—traders shouldn’t rush to sell based solely on this signal. Subtler technical indicators could still influence the stock’s direction, offering some hope for the bulls.

Watchlist for today: NVDA, SMCI, DOCU, COIN, PLTR, AFRM

Markets & today’s action:
 

• Chinese stocks led declines in Asian markets on Wednesday, as weak economic data and Beijing’s reluctance to add more stimulus weighed on sentiment. The CSI 300 Index fell as much as 7.4%, with concerns growing that recent stimulus measures may not be enough for a sustained market recovery.
• U.S. stock futures remained nearly flat on Tuesday night following a positive session for the major indexes. Dow Jones Industrial Average futures dipped by 26 points, or 0.06%, while S&P 500 and Nasdaq 100 futures edged down about 0.1%.
• The market had an intense day earlier, with tech stocks leading gains and oil prices easing. Investors are now focused on the upcoming release of the Fed's meeting minutes on Wednesday at 2 p.m. ET and September's consumer and producer price index data, due on Thursday and Friday. Earnings season begins Friday, featuring reports from major banks such as JPMorgan Chase and Wells Fargo.

Bitcoin
 

• Bitcoin (BTC) remained steady just above $62,000, with any dips below this level quickly recovering, but overall, the trading pattern was lackluster. Over the past 24 hours, BTC slipped 1.2%, in line with the broader CoinDesk 20 Index. Meanwhile, Ethereum's ether (ETH) stayed relatively flat, while Aptos's native token (APT) gained attention with a 6% rise. Many crypto investors had expected October to be a bullish month, but so far, prices have remained flat or declined.
• Looking at a longer timeframe, Bitcoin appears to be consolidating below its all-time high, which some traders, like Bob Loukas, see as a potential setup for a strong rally next year. In other news, Standard Chartered analysts suggest that Solana (SOL) could see a significant surge, potentially rallying 400% if Donald Trump wins the upcoming election.
  Watchlist: Bitcoin: 59 700-63 510, Ethereum: 2320-2550, Solana: 133 -152.50

Forex Market
 

• The EUR/USD pair continued its recovery, reaching around 1.0985 in early European trading on Tuesday, as the U.S. Dollar modestly weakened. However, gains for EUR/USD may be limited, with traders anticipating only a minor interest rate cut from the U.S. Federal Reserve in November.
• Meanwhile, the Japanese Yen stalled its overnight recovery from a nearly two-month low against the Dollar. Uncertainty surrounding a potential Bank of Japan rate hike is capping gains for the Yen, offering some support to USD/JPY. However, ongoing geopolitical tensions could favor the safe-haven Yen, limiting further gains for the pair.
• The GBP/USD pair found some buyers during the Asian session on Tuesday, seemingly breaking its five-day losing streak that took it to a nearly four-week low near the 1.3560 level on Monday. The pair is showing signs of recovery, but it remains to be seen if this rebound will gain traction or face further resistance in the sessions ahead.
• The EUR/USD pair held steady on Tuesday, unable to regain the 1.1000 level but managing to halt its recent decline from the 1.1200 area. The Euro has dropped about 2.3% against the US Dollar since hitting a one-year high in late September, sliding back into the 1.0950 range as the Greenback strengthens broadly.
  Whatchlits: EUR/USD: 1.0947-1.1.1000, USD/JPY: 146-149.50

Basic Materials
 

• Gold (XAU/USD) continues to face selling pressure for the sixth consecutive day, though it is holding just above the three-week low hit on Tuesday. Traders are taking a cautious stance ahead of releasing the FOMC meeting minutes and upcoming U.S. inflation data on Thursday and Friday. These events are expected to clarify the Federal Reserve's rate trajectory, likely impacting the USD's movements and influencing gold prices.
• The Department of Energy (DoE) reported a 0.3 million barrel increase in the Strategic Petroleum Reserve (SPR) as of October 4, raising inventories to 382.9 million barrels—up over 35 million from last summer's low but still 252 million below levels when President Biden took office. At this rate, it would take over five years to reach January 2020 levels.
  Watchlist: GOLD 2620-2685, US Oil: 71.60-77.50

The TEFS Analyst team wishes you a successful day!