S&P 500 Index Might Lead APAC Decrease, Netflix Outlook Disappoints

S&P 500, Hold Seng Index, ASX 200 INDEX OUTLOOK:

  • Dow Jones, S&P 500 and Nasdaq 100 indexes closed -0.89%, -1.10% and -1.34% respectively
  • Netflix tumbled 19% throughout after-hour commerce as its ahead steerage dissatisfied buyers
  • China drafts guidelines to ease property curbs, sending Hong Kong shares larger. Asia-Pacific markets open combined

Netflix Earnings, Hong Kong Inventory Rally, US Jobless Claims, Asia-Pacific at Open:

Wall Avenue equities fell for a 3rd day as buyers mulled combined company earnings and the outlook for Fed tightening. Shares gave up earlier positive aspects and plunged within the remaining hour of buying and selling, underscoring fragile sentiment. The Nasdaq 100 index has fallen greater than 10% from its December excessive, coming into right into a technical correction. Traders are eyeing subsequent Wednesday’s FOMC assembly for clues concerning the central financial institution’s roadmap for tightening. Policymakers might supply clues concerning the timing of the primary price hike and when it would take into account to start out steadiness sheet normalization.

In the meantime, Netflix’s share value plummeted 19% in the course of the after-hour commerce as its ahead outlook fell under market expectations. This occurred despite the fact that the corporate has crushed on each high and backside line estimates in This autumn. Netflix mentioned it expects so as to add 2.5 million subscribers in the course of the first quarter of 2022, far under market expectations 6.93 million. It additionally marks a pointy decline from 8.28 million customers added in This autumn.

Hong Kong shares soared on Thursday after information crossed the wires that China is drafting guidelines to offer property builders extra entry to escrow funds. This can present essential assist to builders to fulfill debt obligations, avoiding a critical money crunch. The Hold Seng Index soared 3.42%, and the Hold Seng Tech Index surged 4.50% on Thursday. Each indices have breached above key resistance ranges and will have reversed a protracted downtrend. Builders, banks and know-how shares have been among the many high gainers.

Chinese language lenders have lowered borrowing pricesfor a second straight month, in keeping with the PBOC’s transfer to chop 1-year MLF price by 10bps earlier this week. That is one other signal that the world’s second-largest financial system is easing financial coverage to cushion an financial slowdown. Decrease rates of interest and the comfort of property guidelines drive urge for food in the direction of Hong Kong shares, with the inventory connection recording HK$6.54 billion of internet Southbound inflows on Thursday, the very best seen since 31st August 2021.

Hold Seng Index vs. Southbound Web Influx

S&P 500 Index May Lead APAC Lower, Netflix Outlook Disappoints

Supply: Bloomberg, DailyFX

In the meantime, weekly preliminary US jobless claims knowledge got here in at 286ok, in comparison with a 220ok estimate. That is additionally the very best studying noticed in 14 weeks. The unemployment claims have been creeping larger in current weeks, however the total degree remains to be considerably decrease than the pandemic-era averages. With extra firms citing rising wage strain and challenges in hiring, this may very well be a short-term surge in unemployment claims.

US Weekly Jobless Claims

S&P 500 Index May Lead APAC Lower, Netflix Outlook Disappoints

Supply: Bloomberg, DailyFX

Asia-Pacific markets look set to open combined on Friday following a bitter lead from Wall Avenue. The Hong Kong market may very well be an exception, as buyers persevering with to digest property information and price cuts by the Chinese language authority. Futures in Japan, Australia, India, Thailand and Indonesia are within the purple, whereas these in mainland China, Hong Kong, South Korea and Taiwan are within the inexperienced.

Wanting again to Thursday’s shut, 10 out of 11 S&P 500 sectors ended decrease, with 84.2% of the index’s constituents closing within the purple. Shopper discretionary (-1.94%) supplies (-1.43%) and knowledge know-how (-1.33%) have been among the many worst performers, whereas defensive-linked utilities (+0.14%) registered a small acquire.

S&P 500 Sector Efficiency 20-01-2022

S&P 500 Index May Lead APAC Lower, Netflix Outlook Disappoints

Supply: Bloomberg, DailyFX

S&P 500 Index Technical Evaluation

The S&P 500 index has seemingly damaged down an “Ascending Channel” shaped since March 2021, exposing the subsequent assist degree of 4,470 – the 200% Fibonacci extension. This can be one other wholesome correction alongside its upward trajectory nonetheless, because the trio of 20-, 50- and 100-day SMA strains are trending up. The MACD indicator shaped a decrease excessive nonetheless, suggesting that near-term momentum could also be weakening.

S&P 500 Index – Each day Chart

S&P 500 Index May Lead APAC Lower, Netflix Outlook Disappoints

Chart created with TradingView

Hold Seng Index Technical Evaluation:

The Hold Seng Index (HSI) has seemingly damaged a “Falling Wedge” sample from the upside, as highlighted within the chart under. This may increasingly sign a bullish development reversal after a protracted interval of promoting, and open the door for additional positive aspects. An instantaneous resistance degree could be discovered at 24,900, adopted by 25,600. The MACD indicator pierced by the impartial midpoint and trended larger, suggesting that bullish momentum could also be fading.

Hold Seng Index – Each day Chart

S&P 500 Index May Lead APAC Lower, Netflix Outlook Disappoints

Chart created with TradingView

ASX 200 Index Technical Evaluation:

The ASX 200 index pulled again to a range-bound zone between 7,200 to 7,500, ready for contemporary catalyst for a breakout. The ground and ceiling of the vary could also be considered as fast assist and resistance ranges respectively. A significant breach above 7,500 might intensify shopping for strain and expose the subsequent resistance degree of seven,760.

ASX 200 Index – Each day Chart

S&P 500 Index May Lead APAC Lower, Netflix Outlook Disappoints

Chart created with TradingView

— Written by Margaret Yang, Strategist for DailyFX.com

To contact Margaret, use the Feedback part under or @margaretyjy on Twitter

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