US Open: US Markets Continue Decline, Quantum Computing Stocks Plunge on Nvidia Comments

• US markets broadly lower with US2000 leading declines at -1.25%, while VIX rises 3.55% to 18.38 amid increased volatility

• Nvidia's quantum computing comments trigger sector-wide selloff with Rigetti (-25%), D-Wave (-19%), and IonQ (-13%) plunging after CEO suggests technology is 15-30 years away from practical use

• BWXT Technologies announces $525M acquisition of Kinectrics to expand nuclear services presence, deal expected to close mid-2025

• Tesla could receive over €1B in EU emissions pooling compensation from Toyota, Stellantis, and Ford; stock faces pressure from NHTSA investigation into "Actually Smart Summon" feature

• AMD enters AI drug discovery market with $20M investment in Absci, whose shares surge 54% on partnership news

• Exxon Mobil warns of Q4 earnings decline due to lower oil prices and refining margins, expects $500-900M reduction in upstream earnings from Q3

• Fed Governor Waller signals support for 2025 rate cuts, downplays inflation impact from potential import tariffs

US equity markets are showing broad weakness, with major indices declining. The US2000 leads the losses, falling 1.25% to 2235.2, followed by the BRAComp dropping 1.21% to 120736. The US30 is down 0.26% to 42667, while the US500 declines 0.15% to 5945.0. Market volatility is rising, with the VIX up 3.55% to 18.38.

European markets are mixed, with VSTOXX showing a notable gain of 2.94% to 17.53, and Italy's ITA40 rising 0.17% to 34990. However, most other European indices are in negative territory. The W20 shows the steepest decline at -0.92% to 2250.6, followed by France's FRA40 falling 0.84% to 7412.2. Austria's AUT20 is down 0.74% to 3625, while Spain's SPA35 drops 0.61% to 11704. The Netherlands' NED25 (-0.60%), EU50 (-0.47%), and Germany's DE40 (-0.13%) are all lower.

Looking at S&P 500 sectors, only Information Technology (+0.19%) and Consumer Discretionary (+0.08%) are trading in positive territory. Utilities leads the declines (-0.93%), followed by Communication Services (-0.83%) and Real Estate (-0.63%). Health Care (-0.55%), Materials (-0.45%), Industrials (-0.36%), Energy (-0.30%), Consumer Staples (-0.26%), and Financials (-0.20%) are all lower. The overall market shows weakness with the S&P 500 down 0.19%.

Current volatility observed on Wall Street. Source: xStation 

The Nasdaq-100 index, represented by the US100 contract, is trading below the early December high of 21,668 following yesterday's drop. This level serves as a resistance for bulls and aligns with the 23.6% Fibonacci retracement level.

For bears, key downside targets include the 38.2% Fibonacci retracement level, followed by the mid-November high at 21,255 and the 50-day SMA at 21,179. If these levels are breached, the next target could be the 61.8% Fibonacci retracement level.

The RSI has cooled off and is on track to lose its bullish divergence as it nears a key support level that has historically acted as a retracement zone. This could indicate a potential pause or reversal in the current trend. Meanwhile, the MACD remains in a downtrend, reinforcing the cautionary outlook. Source: xStation

News:

• BWXT Technologies (BWXT.US) announced a strategic $525m acquisition of Canadian nuclear services company Kinectrics, aiming to strengthen its position in the nuclear power and radiopharmaceutical industries. The deal, expected to close by mid-2025, will nearly double BWXT's commercial operations workforce and expand its capabilities in lifecycle management and specialized plant services.

• Tesla (TSLA.US) faces mixed developments: The company could receive over €1 billion in compensation from automakers including Toyota, Stellantis, and Ford through EU emissions pooling arrangements. However, the stock declined in premarket trading after NHTSA launched an investigation into its "Actually Smart Summon" feature. The investigation covers most Tesla vehicles from 2016 to 2025.

• AMD (AMD.US) enters the AI-powered drug discovery market through a $20 million PIPE investment in Absci Corp (ABSI.US). The partnership marks AMD's first healthcare investment, directly competing with Nvidia in this space. Absci's stock surged 54% on the news.

• Nvidia (NVDA.US) showed signs of recovery, rising 1.75% after Tuesday's 6.2% decline that wiped out $200 billion in market value. The company received indirect support from Amazon's announcement of an $11 billion investment in cloud and AI infrastructure in Georgia.

• Exxon Mobil (XOM.US) warned of lower Q4 earnings due to falling oil prices and weaker refining margins. The company expects upstream earnings to decrease by $500-900 million from Q3, while changes in gas prices could provide a boost of up to $400 million. Analysts at Mizuho lowered their EPS estimates to $1.55.

• Federal Reserve Governor Christopher Waller indicated support for interest rate cuts in 2025, stating that proposed import tariffs are unlikely to significantly impact inflation. The ADP December employment report came in at 122,000 jobs, below the expected 140,000, while initial jobless claims fell to 201,000 versus the forecast of 214,000.

• Quantum Computing Stocks Plunge after Nvidia CEO Jensen Huang's sobering timeline assessment for the technology. During Nvidia's analyst day, Huang estimated that "very useful" quantum computers are likely 15-30 years away, triggering a broad selloff in the sector: IonQ (IONQ.US) dropped over 37%, while Rigetti Computing (RGTI.US) plummeted 40%.

Other news coming from individual S&P 500 index companies. Source: Bloomberg Financial LP