US OPEN: Wall Street extends downward move

• US indices launched today's cash trading lower
• Upbeat claims and Philly Fed data
• Roblox (RBLX.US) stock plunges after Morgan Stanley downgrade

Three major Wall Street indices launched today's session lower, extending recent losses, with Dow Jones trading 0.7% lower, while the S&P 500 and Nasdaq fell 0.60% and 0.80% respectively as investors remain concerned that the FED will continue its tightening process despite signs of easing inflation. Today Fed's Collins said the policy rate should be raised to just above 5%, and then held there for some time. On the other hand, she added that it is appropriate to slow the pace of rate hikes, especially since risks are now more balanced. On the data front, claims fell last week to the lowest in four months, throwing some cold water into expectations that the Fed will pivot away from its aggressive stance. The Philadelphia Fed Manufacturing Index rose to -8.9 in January from a revised reading of -13.7 in December, compared to market expectations of -11. It was still the fifth consecutive negative reading and the seventh negative reading in the past eight months. At the same time, recent data showed retail sales, producer prices, and industrial production dropped more than expected last month, which fueled concerns over the health of the US economy. Later on investors’ attention will focus on Netflix earnings which will be released after market close.

S&P 500 index stocks categorized by sectors and industries. Size represents market cap. Source: xStation5

US100 sharply in recent days after buyers failed to break above long-term downward trendline. Today the index broke below key support at 11500 pts and 50 SMA (green line). If sellers manage to uphold current momentum downward move may accelerate towards October 2022 low at 10460 pts, which is marked with previous price reactions and 61.8% Fibonacci retracement of the upward wave started at the beginning of pandemic. Source: xStation5

Company news:

Roblox (RBLX.US) shares plunged over 6.0% in premarket after Morgan Stanley downgraded the video game company to ‘underweight’ from ‘equal weight’, citing limited upside potential.

Roblox (RBLX.US) launched today's session with bearish price gap and is trading below major support at $33.85, which coincides with 61.8% Fibonacci retracement of the last upward wave. If current sentiment prevails, downward move may deepen towards next support at $28.50. Source: xStation5

Tesla (TSLA.US) stock plunged nearly 2.0% before the opening bell after Piper Sandler cut its price target on the EV maker to $300 from $340, however kept an ‘overweight’ rating, saying Musk waited too long to cut prices.

Charles Schwab (SCHW.US) stock fell nearly 3.0% in premarket after  Bank of America double downgraded the brokerage  to underperform from buy as it expects that clients growth will drop in 2023 as customers will shift to money market funds due to higher interest rates.

Procter & Gamble (PG.US) shares dropped over 3.0% in off-hours trading after the consumer goods giant posted mixed quarterly results Company earned $1.59, which came in line with expectations, while revenue of $20.77 billion slightly beat analysts’ estimates of $20.73 billion.

Apple (AAPL.US) fell over 1.0% after JPMorgan lowered its price target on iPhone maker and believes supply headwinds will affect its earnings.