US OPEN: Bearish opening of Thursday's session on Wall Street with ISM in focus

• Wall Street set for lower opening
• Levi Strauss & Co. shares slumped as much as 12% as company lowered revenue growth outlook
• Tesla Inc. announced a recall of over 27,000 Cybertruck vehicles in the United States

US equities are set for a lower open, with the Nasdaq 100 leading losses, down 0.75%. The S&P 500 is down by 0.45% with Russell 2000 0.7% lower. Market participants may be awaiting ISM data today.

In Europe, most indexes are in the red. The British UK100 is the only one in green, up by 0.23%. German DE40 is down 0.6%, while the Italian ITA40 is over 1.35% lower and French CAC40 dropping over 0.78%. The Polish WIG20 is the worst performer, with a nearly 1.36% loss.

Levi Strauss & Co. shares slumped as much as 12% in premarket trading after the company lowered its revenue growth outlook for the full year and reported third-quarter sales that trailed Wall Street expectations. Tesla Inc. announced a recall of over 27,000 Cybertruck vehicles in the United States due to an issue with delayed rear-view camera images.

Current volatility observed on Wall Street. Source: xStation 

Breakdown of the S&P 500 index by sectors. Source: Bloomberg Finance L.P

The Nasdaq-100 index, represented by the US100 contract, is trading near mid-August highs at 19,917.81, a key level that needs to be broken for bulls to gain control. For continued upward momentum, resistance at the 78.6% Fibonacci retracement level must also be cleared. The index has been in an uptrend since late July, forming higher highs and higher lows. It is now approaching the April high, which could signal a potential trend reversal.

However, the uptrend appears to be forming a bearish wedge, with levels around the 50% Fibonacci retracement potentially confirming a reversal if broken. For bears to take control, the mid-August highs of 19,917.81 must be breached, leading to support at the 61.8% Fibonacci retracement level, which previously acted as strong resistance during the uptrend.

Currently, the RSI is showing signs of bearish divergence, with a shift towards lower lows and lower highs. The MACD is also signaling a sell. Furthermore, the 50-day SMA is nearing the 100-day SMA, which could trigger a sell signal if the crossover occurs. Source: xStation 5

News:

• Tesla Inc. (TSLA.US) announced a recall of over 27,000 Cybertruck vehicles in the United States due to an issue with delayed rear-view camera images. The problem, which could impair driver visibility and increase crash risks, stems from the system not completing its shutdown process before being commanded to boot up. This can result in a delay of up to six to eight seconds in displaying the rear-view image when the vehicle is shifted into reverse. Tesla plans to resolve the issue through a software update. This recall follows an earlier one this year for most Cybertrucks due to problems with windshield wipers and exterior trim. The company's shares may experience volatility as investors assess the impact of these recurring quality issues on the Cybertruck's rollout and Tesla's reputation.
• Levi Strauss & Co. (LEVI.US) shares slumped as much as 12% in premarket trading after the company lowered its revenue growth outlook for the full year and reported third-quarter sales that trailed Wall Street expectations. Levi now sees FY2024 net revenue growth of +1%, down from the previous forecast of +1% to +3%. The company's Q3 adjusted EPS of $0.33 beat estimates of $0.31, while net revenue of $1.52 billion (+0.4% y/y) fell short of the expected $1.55 billion. Levi also announced it has initiated a formal review of strategic alternatives for the Dockers brand, including a potential sale.
• Hims & Hers Health, Inc. (HIMS.US) shares tumbled 13% in premarket trading following the FDA's announcement that Eli Lilly's blockbuster weight-loss and diabetes drugs are no longer considered to be in shortage in the U.S. This development could potentially impact Hims & Hers, which has been selling compounded versions of obesity drugs. The end of the shortage for Lilly's drugs may constrain Hims & Hers' total addressable market and suggests a faster-than-anticipated resolution to drug shortages in this category.
• EVgo Inc. (EVGO.US) shares are likely to react positively to the news that the company has received a conditional commitment for a loan guarantee of up to $1.05 billion from the U.S. Department of Energy. This financing is expected to support the construction of approximately 7,500 new DC fast charging stalls in community locations across the U.S. by 2030. The project is anticipated to create over 1,000 jobs and align with the Biden-Harris administration's Justice40 initiative, with over 40% of stalls planned for marginalized areas. EVgo plans to leverage the 30C tax credit expanded under the Inflation Reduction Act to support the buildout.

Other news coming from individual DAX index companies. Source: Bloomberg Financial LP