S&P 500, ASX 200, NIKKEI 225, ASIA-PACIFIC MARKET OUTLOOK:
- The S&P 500, Dow Jones and Nasdaq plunged 2.57%, 2.05% and 2.61% respectively
- The FOMC meeting revealed little changes; Apple and Facebook earnings beat
- Asia-Pacific indices are poised to open sharply lower following a sour US lead
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Market Turmoil, FOMC, Earnings, Asia-Pacific Stocks Outlook:
Wall Street stocks had a bloodbath day without clear fundamental reasons behind, leading market participants to question if the short squeeze in GameStop (+134%) and AME entertainment (+301%) have forced some hedge funds to liquidate their long positions in other stocks to cover losses. This appeared to have sparked broader risk aversion and encouraged more liquidation in a time when stock markets valuations are at their highest levels since the Dotcom bubble.
The S&P 500, Dow Jones and Nasdaq indices fell the most since October 28th, ending -2.57%, -2.05% and -2.61% lower respectively. It seems like the time is ripe for a technical correction after all three indices broke their “Ascending Channels” formed since early November. Profit-taking activity may ramp up in the days to come should selling momentum start to gain traction. The VIX volatility index surged to 33.6 from 26.3 overnight, marking a 28% jump.
Apple, Facebook revealed upbeat Q4 earnings results after Wednesday market close, but their share prices were trading lower amid souring market sentiment. Tesla share price fell 4.2% after reporting a slight EPS miss. Here is a quick earnings takeaway from the trio:
Apple (beat):
- EPS: US$ 1.680 vs US$1.417 estimated, up 34.7% YoY
- Revenue: US$ 111.4 billion vs 103.1 billion estimated, up 21% YoY
- Sales from every product category registered double digit growth for the quarter
Facebook (beat):
- EPS: US$ 3.88 vs US$3.54 estimated, up 51.6% YoY
- Revenue: US$ 28.07 billion vs US$ 26.74 billion estimated, up 33.2% YoY
- Daily Active Users (DAU): 1.84 billion vs 1.828 billion estimated, up 10.8% YoY
Tesla (slight miss):
- EPS: US$ 0.80 vs US$ 1.03 estimated
- Revenue: US$ 10.74billion vs US$ 10.4 billion estimated, up 45.5% YoY
- Tesla expects 50% average annual growth in vehicle deliveries over a multi-year horizon
The FOMC meeting offered little changes in terms of Fed’s monetary policy. The central bank will maintain an accommodative stance and continue asset purchasing at the pace of US$ 120 billion per month until its long-term goal of maximum employment and 2 percent inflation target are achieved. Today’s US Q4 GDP, initial jobless claims and core PCE inflation data are among the top events. Find out more from DailyFX economic calendar.
Sector-wise, all 11 S&P 500 sectors declined, with only 15% of the index’s constituents closing in the green on Wednesday. Communication services (-3.82%), consumer discretionary (-3.13%) and healthcare (-3.05%) were among the hardest hit.
S&P 500 Sector Performance 27-01-2021
Source: Bloomberg
Without much surprise, the Nikkei 225 and Australia’s ASX 200 indices opened sharply lower following a sour US lead. Equity index futures across Japan, mainland China, Australia, Hong Kong, South Korea, Taiwan, Singapore, India and Thailand are looking to retrace broadly.
The ASX 200 index tumbled more than 2% in early trading hours, dragged by healthcare (-2.33%), information technology (-2.27%), and financials (-2.01%) sectors, whereas defensive-linked consumer staples (-0.33%) and utilities (-0.36%) sectors registered smaller losses. All eleven ASX 200 sectors opened lower.
ASX 200 Top 10 Stocks Performance at Open 28-01-2021
Source: Bloomberg, DailyFX
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S&P 500 Index Technical Analysis:
Technically, the S&P 500 index broke the “Ascending Channel” decisively, suggesting that a technical correction might be underway. Price pierced through the 20-Day Simple Moving Average (SMA) line and is about to test the 50-Day SMA at 3,740. Breaking the 50-Day SMA may open the door for further losses with an eye on 3,705 (50% Fibonacci extension) and 3,660 (38.2% Fibonacci extension) for support. The MACD indicator has likely formed a “Death Cross”, suggesting that downward momentum is prevailing.
S&P 500 Index – Daily Chart
ASX 200 Index Technical Analysis:
The ASX 200 index registered a large bearish candlestick on the daily chart today, breaking below a key support level at 6,630 (161.8% Fibonacci extension). The lower bound of the range between 6,570 to 6,810 that it has been trading within since late November may serve as an immediate support, as highlighted in the chart below. The index is also broken its 50-Day SMA, signally that a deeper pullback could be underway.
ASX 200 Index – Daily Chart
Nikkei 225 Index Technical Analysis:
The Nikkei 225 index pulled back from recent highs and is poised to test an immediate support level at 28,200- the 161.8% Fibonacci extension. Breaking below this level may lead to a deeper correction with an eye on its 50-Day SMA for support. The MACD indicator has formed a bearish crossover, hinting at short-term selling pressure.
Nikkei 225 Index – Daily Chart
S&P 500 Earnings Calendar 27-28th January 2021
Name |
Date |
Period |
Actual |
Estimate |
Surprise |
Anthem Inc |
27/1/2021 |
Q4 20 |
2.54 |
2.516 |
1.00 |
Packaging Corp of America |
27/1/2021 |
Q4 20 |
1.33 |
1.468 |
(9.40) |
Whirlpool Corp |
27/1/2021 |
Q4 20 |
6.64 |
6.176 |
7.50 |
Xilinx Inc |
27/1/2021 |
Q3 21 |
0.69 |
0.674 |
2.40 |
Tesla Inc |
27/1/2021 |
Q4 20 |
0.80 |
1.026 |
(22.00) |
United Rentals Inc |
27/1/2021 |
Q4 20 |
5.04 |
4.241 |
18.80 |
Crown Castle International Cor |
27/1/2021 |
Q4 20 |
4.45 |
1.572 |
182.90 |
Edwards Lifesciences Corp |
27/1/2021 |
Q4 20 |
0.50 |
0.532 |
(6.00) |
Teradyne Inc |
27/1/2021 |
Q4 20 |
1.10 |
0.999 |
10.10 |
MarketAxess Holdings Inc |
27/1/2021 |
Q4 20 |
1.91 |
1.821 |
4.90 |
Textron Inc |
27/1/2021 |
Q4 20 |
1.06 |
0.911 |
16.40 |
Prosperity Bancshares Inc |
27/1/2021 |
Q4 20 |
1.49 |
1.344 |
10.60 |
AT&T Inc |
27/1/2021 |
Q4 20 |
0.75 |
0.727 |
3.20 |
Teledyne Technologies Inc |
27/1/2021 |
Q4 20 |
3.20 |
3.17 |
0.90 |
Brinker International Inc |
27/1/2021 |
Q2 21 |
0.35 |
0.298 |
17.40 |
Blackstone Group Inc/The |
27/1/2021 |
Q4 20 |
1.13 |
0.912 |
23.90 |
VF Corp |
27/1/2021 |
Q3 21 |
0.93 |
0.90 |
3.30 |
Automatic Data Processing Inc |
27/1/2021 |
Q2 21 |
1.52 |
1.289 |
17.90 |
Nasdaq Inc |
27/1/2021 |
Q4 20 |
1.60 |
1.454 |
10.00 |
General Dynamics Corp |
27/1/2021 |
Q4 20 |
3.49 |
3.552 |
(1.70) |
Corning Inc |
27/1/2021 |
Q4 20 |
0.52 |
0.485 |
7.20 |
Hess Corp |
27/1/2021 |
Q4 20 |
(0.58) |
(0.659) |
12.00 |
Rollins Inc |
27/1/2021 |
Q4 20 |
0.13 |
0.112 |
16.10 |
Abbott Laboratories |
27/1/2021 |
Q4 20 |
1.45 |
1.356 |
6.90 |
Boeing Co/The |
27/1/2021 |
Q4 20 |
(4.18) |
(2.113) |
(97.60) |
Amphenol Corp |
27/1/2021 |
Q4 20 |
1.13 |
1.026 |
10.10 |
Norfolk Southern Corp |
27/1/2021 |
Q4 20 |
2.64 |
2.468 |
7.00 |
Progressive Corp/The |
27/1/2021 |
Q4 20 |
1.83 |
1.701 |
7.70 |
SL Green Realty Corp |
27/1/2021 |
Q4 20 |
1.556 |
||
PTC Inc |
27/1/2021 |
Q1 21 |
0.97 |
0.658 |
47.40 |
Cree Inc |
27/1/2021 |
Q2 21 |
(0.24) |
(0.247) |
2.80 |
Hologic Inc |
27/1/2021 |
Q1 21 |
2.86 |
2.17 |
31.80 |
Facebook Inc |
27/1/2021 |
Q4 20 |
3.88 |
3.217 |
20.60 |
Lam Research Corp |
27/1/2021 |
Q2 21 |
6.03 |
5.722 |
5.40 |
Duke Realty Corp |
27/1/2021 |
Q4 20 |
0.41 |
0.406 |
1.00 |
Ameriprise Financial Inc |
27/1/2021 |
Q4 20 |
4.53 |
4.468 |
1.40 |
Las Vegas Sands Corp |
27/1/2021 |
Q4 20 |
(0.37) |
(0.329) |
(12.50) |
ServiceNow Inc |
27/1/2021 |
Q4 20 |
1.17 |
1.06 |
10.40 |
Raymond James Financial Inc |
27/1/2021 |
Q1 21 |
2.23 |
1.68 |
32.70 |
Apple Inc |
27/1/2021 |
Q1 21 |
1.68 |
1.417 |
18.60 |
Rexnord Corp |
28/1/2021 |
Q4 20 |
0.383 |
||
Dow Inc |
28/1/2021 |
Q4 20 |
0.67 |
||
T Rowe Price Group Inc |
28/1/2021 |
Q4 20 |
2.723 |
||
McDonald’s Corp |
28/1/2021 |
Q4 20 |
1.769 |
||
Marsh & McLennan Cos Inc |
28/1/2021 |
Q4 20 |
1.127 |
||
McCormick & Co Inc/MD |
28/1/2021 |
Q4 20 |
0.808 |
||
Sherwin-Williams Co/The |
28/1/2021 |
Q4 20 |
4.863 |
||
A O Smith Corp |
28/1/2021 |
Q4 20 |
0.585 |
||
MSCI Inc |
28/1/2021 |
Q4 20 |
1.935 |
||
Danaher Corp |
28/1/2021 |
Q4 20 |
1.858 |
||
Murphy Oil Corp |
28/1/2021 |
Q4 20 |
(0.099) |
||
Comcast Corp |
28/1/2021 |
Q4 20 |
0.473 |
||
PulteGroup Inc |
28/1/2021 |
Q4 20 |
1.40 |
||
Westrock Co |
28/1/2021 |
Q1 21 |
0.543 |
||
Valero Energy Corp |
28/1/2021 |
Q4 20 |
(1.417) |
||
Stanley Black & Decker Inc |
28/1/2021 |
Q4 20 |
2.996 |
||
Northrop Grumman Corp |
28/1/2021 |
Q4 20 |
5.773 |
||
Xcel Energy Inc |
28/1/2021 |
Q4 20 |
0.54 |
||
ABIOMED Inc |
28/1/2021 |
Q3 21 |
1.089 |
||
American Airlines Group Inc |
28/1/2021 |
Q4 20 |
(4.111) |
||
JetBlue Airways Corp |
28/1/2021 |
Q4 20 |
(1.671) |
||
Flex Ltd |
28/1/2021 |
Q3 21 |
0.37 |
||
Nucor Corp |
28/1/2021 |
Q4 20 |
1.192 |
||
Mastercard Inc |
28/1/2021 |
Q4 20 |
1.514 |
||
Alliance Data Systems Corp |
28/1/2021 |
Q4 20 |
2.392 |
||
Tractor Supply Co |
28/1/2021 |
Q4 20 |
1.517 |
||
NVR Inc |
28/1/2021 |
Q4 20 |
80.448 |
||
Southwest Airlines Co |
28/1/2021 |
Q4 20 |
(1.668) |
||
Altria Group Inc |
28/1/2021 |
Q4 20 |
1.017 |
||
Dover Corp |
28/1/2021 |
Q4 20 |
1.375 |
||
Celanese Corp |
28/1/2021 |
Q4 20 |
1.683 |
||
ResMed Inc |
28/1/2021 |
Q2 21 |
1.25 |
||
Juniper Networks Inc |
28/1/2021 |
Q4 20 |
0.533 |
||
Skyworks Solutions Inc |
28/1/2021 |
Q1 21 |
2.058 |
||
Visa Inc |
28/1/2021 |
Q1 21 |
1.278 |
||
Arthur J Gallagher & Co |
28/1/2021 |
Q4 20 |
0.789 |
||
Western Digital Corp |
28/1/2021 |
Q2 21 |
0.54 |
||
MicroStrategy Inc |
28/1/2021 |
Q4 20 |
|||
United States Steel Corp |
28/1/2021 |
Q4 20 |
(0.68) |
||
Mondelez International Inc |
28/1/2021 |
Q4 20 |
0.663 |
||
Principal Financial Group Inc |
28/1/2021 |
Q4 20 |
1.428 |
||
Robert Half International Inc |
28/1/2021 |
Q4 20 |
0.679 |
||
Eastman Chemical Co |
28/1/2021 |
Q4 20 |
1.501 |
Source: Bloomberg
— Written by Margaret Yang, Strategist for DailyFX.com
To contact Margaret, use the Comments section below or @margaretyjy on Twitter
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