Nasdaq loses after US sending marines to Israel, AI chips restrictions and strong US sales reading,📌
Futures on Wall Street indices are falling down before the US open, pressured by rising yields. According to the US Department of Defense has confirmed that some 2,000 US military personnel are on heightened alert. Although no decisions have yet been made on the deployment of forces to the Middle East. According to WAPO, the U.S. will send marines, on warships, to Israel, which has heightened market concerns about the escalation scenario and potential expansion of the conflict.
- In addition, the U.S. has announced additional China export restrictions on AI chips from Nvidia, although the company itself has managed to communicate that it does not expect the restrictions to significantly affect its business and results. However, the market sees this as further signals of geopolitical uncertainty.
- Additionally, retail sales data came in much stronger than expected in both the headline (0,7% m/m vs 0,3% exp) and core (0,6%m/m vs 0,2% exp.) readings. This puts an additional question mark over the Fed's ongoing interest rate hike cycle and may herald that at least one more hike will be needed to curb demand from a strong consumer. Also US industrial production was stronger than expected with 0,3% m/m reading vs 0,3% exp. and 0,6% previously.
US100 (H1) chart
Looking at H1 US100 chart we can see that price dropped to potentially strong support level at 15,150 points where we can see SMA200 (red line). If bears will break below this level basic scenario may be a test of 14,900 points where 61,8 Fibonacci retracement of the upward wave from 3 October is located. At the same tim futures on US Dollar Index (USDIDX) gains 0,2% and VIX gains almost 3%. US 10-year treasuries yields hit this year highs at 4,85% today.
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Source: xStation5
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