Most Asian Indices Fell On Weakness In Tech
Most Asian equities markets fell on weakness in the technology sector. The losses were led by Apple suppliers like Japan Display which fell -9.0%. News released Monday from Lumentum suggests sales of Apple’s iPhones are slowing and that has the entire tech sector moving lower. The Japanese Nikkei led the major indices with a loss near 2.0% and was closely followed by the Australian ASX.
The Australian equities Index ASX fell about 1.80% on weakness in energy. Monday’s sudden reversal in oil prices took the world’s number one commodity to a new low and drug energy-related stocks with it.
Chinese markets were the outlier in today’s session. Both the mainland Shang Hai Composite and Hong Kong-based Heng Send Index were able to close with gains, 0.93% for the Shang Hai and 0.62% for the Heng Seng. The move in Chinese equities is notable because the Shang Hair opened with significant losses, rallied throughout the day, and formed a large green candle at the 25,000 support level.
European Markets Up On Earnings, Outlook, and Politics
The European market was able to move higher in early Tuesday trading although markets were mixed. The DAX led at mid-morning with a gain near 0.80% while the CAC had advanced about half that and the FTSE was hugging break-even levels.
In earnings news, shares of Vodafone advanced nearly 6.0% on its results and comments from management. The CEO of Vodafone says the company, under his leadership, plans to cut 1.2 billion in operating costs over the next three years.
In politics, Theresa May says Brexit negotiations are in their endgame although there are still hurdles to overcome. In Italy, leaders are tasked by the EU to come up with a new budget proposal by next Tuesday. The first proposal, heavy on spending, was favored by Italy’s pro-growth government but nixed by the EU during last weeks council of finance ministers.
US Equities Rebound, Traders Skeptical
US equities markets rebound in the early pre-market session, but the gains were small. The Dow Jones Industrial Average was the laggard with a gain near 0.30%, the NASDAQ Composite led with a gain near 0.60%, and the S&P 500 was indicated to open with a gain near 0.40%. The moves are a bullish sign for chart-watchers but have yet to show any strength. The major indices are sitting on important support targets that will have a profound effect on stock prices over the long-term if broken or when confirmed.
Tuesday action was led by Home Depot which blew past earnings expectations with EPS of $2.51 per share. The company says YOY revenue grew 5.1% beating the consensus by $60 million. The EPS results beat the consensus by $0.26 and spurred management to raise the full year guidance. Shares of Home Depot popped on the news and moved up by 3.0% in the pre-market session.
This article was originally posted on FX Empire
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