US Open: Wall Street continues selloff on Monday amid Tech weakness

• Wall Street trades sharply lower with US100 down 1.83% to 21,304, US500 falls 1.66% to 5,927
• Boeing shares plunge 5% after deadly 737-800 crash in South Korea kills 179 people
• ByteDance plans $7B Nvidia chip investment outside China in 2025 despite US restrictions
• MicroStrategy acquires additional $209M in Bitcoin at $97,837 average price
• American Airlines upgraded to outperform at Raymond James with $24 target

US equity markets are showing broad weakness, with major indices declining significantly. The US100 leads the losses, falling 1.83% to 21304.46, followed by the US2000 dropping 1.67% to 2225.5. The US500 is down 1.66% to 5927.7, while the US30 declines 1.61% to 42647. Market volatility has spiked, with the VIX surging 9.21% to 18.38. Latin American markets are mixed, with BRAComp showing resilience, up 0.30% to 121809, while MEXComp declines 1.24% to 49779.

European markets are broadly lower, with Germany's DE40 falling 0.90% to 19931.1, followed by the Netherlands' NED25 dropping 0.88% to 872.38. The EU50 is down 0.81% to 4872.6, while France's FRA40 declines 0.54% to 7317.7. The UK100 shows modest losses of 0.42% to 8113.0. Only a few markets are showing gains, with Austria's AUT20 up 0.33% to 3641 and Spain's SPA35 adding 0.22% to 11505.

Looking at S&P 500 sectors, all sectors except Energy are trading in negative territory. Consumer Discretionary leads the declines, falling 2.19%, followed by Industrials (-1.73%) and Information Technology (-1.67%). Communication Services (-1.65%), Health Care (-1.44%), Materials (-1.44%), Consumer Staples (-1.37%), Real Estate (-1.21%), Utilities (-0.99%), and Energy (-0.46%) are all lower. The overall market shows significant weakness with the S&P 500 down 1.60%.

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. The mid-November high at 21,255 serves as the initial support level for bulls, with the 50-day SMA at 21,078 closely aligning with the mid-July high of 20,895, offering additional support.

For bears, key targets include the 100-day SMA at 20,427 and the August highs near 19,917, which act as critical downside levels.

The RSI is approaching a key support level that has previously served as a retracement zone, potentially signaling a pause or reversal. Meanwhile, the MACD is narrowing but continues to exhibit bearish divergence, indicating caution for bullish momentum.  Source: xStation

News

• Boeing (BA.US) shares dropped nearly 5% following a tragic crash of a Boeing 737-800 in South Korea that killed 179 of 181 people on board. The Jeju Air-operated aircraft crashed during landing at Muan International Airport, possibly due to a bird strike causing landing gear failure. South Korean authorities announced inspections of all 101 Boeing 737-800 aircraft in the country. Wolfe analyst Myles Walton notes the crash likely has no connection to Boeing's current 737 Max production challenges, though it highlights the aerospace industry's unique headline risks.
• ByteDance plans to spend up to $7 billion on Nvidia AI chips outside China in 2025, potentially becoming one of the world's largest consumers of such hardware. The TikTok parent company is circumventing U.S. export restrictions by accessing Nvidia's advanced Hopper AI chips through data centers outside China. The company expects total AI-related spending of over $20 billion in 2025, including data centers and infrastructure.
• MicroStrategy (MSTR.US) acquired an additional $209 million worth of Bitcoin, purchasing 2,138 tokens at an average price of $97,837 between December 23-29. The company, which recently joined the Nasdaq 100, aims to raise $42 billion over three years through stock sales and convertible debt offerings to expand its Bitcoin holdings.
• Apple (AAPL.US) faces increased competition in China as Huawei announces significant discounts of up to 3,000 yuan ($411) on premium models for the New Year. Apple's Chinese market share dropped to 15.6% in Q3, while Huawei's grew 42% to 15.3%. Analysts remain divided on Apple's outlook, with Wedbush projecting 26% upside potential driven by AI initiatives, while Barclays maintains an underweight rating with a $184 target price.
• American Airlines (AAL.US) received an upgrade to outperform from Raymond James analyst Savanthi Syth, with a $24 price target implying 38% upside. The upgrade cites improved revenue outlook and corporate customer engagement.

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