US OPEN: Wall Street reduces gains after Powell's pivot on Friday

The start of today's session on Wall Street is marked by slight pessimism, which results from profit-taking after Friday's bullish reaction to Powell's dovish pivot. Companies related to the cryptocurrency sector are performing particularly poorly today. Key events this week include the PCE inflation reading and Nvidia's quarterly results.

US100 (D1 interval)

The Russell 2000 Index, represented by the US2000 contract, is trading nearly 0.45% lower today compared to Friday's close. The index continues to maintain a dynamic upward trend, as illustrated by the exponential moving averages (50-, 100-, and 200-day EMAs, respectively). The most important support level for the instrument remains the 50-day EMA (blue curve). The instrument has broken above the highest levels recorded since 2024.

Source: xStation 5

Company news:

• Aehr Test Systems (AEHR.US) is seeing a significant 14% increase before the market opens, driven by further orders for their advanced semiconductor testing equipment. The company has received an order for six Sonoma systems, which are designed for ultra-high-power testing of packaged components used primarily in the production of artificial intelligence (AI) processors. The increase in orders from a key customer confirms the growing demand for technologies supporting AI development, which is an important trend in the semiconductor industry. AEHR specializes in chip testing and burn-in solutions, which are critical to ensuring quality and reliability in the production of advanced integrated circuits. Demand for such systems is growing with the increase in the production of AI processors, which require endurance testing and precise quality control procedures.

• American Eagle Outfitters (AEO.US) is down 4.1% after Bank of America downgraded its recommendation from neutral to underperform, reflecting a pessimistic view on the company's prospects for recovery. BofA analysts lowered their earnings per share forecast for fiscal 2026 by 30% to $0.95, taking into account lower prices and weaker sales. The reason is the expected tariff pressure and reduced margins, which will negatively affect the company's profitability, as well as the high risk of earnings revisions due to reduced valuation and stock fundamentals. BofA also lowered its target price to $10 from $11, emphasizing a more conservative approach to financial forecasts and reduced expectations for the company's future performance. This reflects a difficult market environment for American Eagle and a potentially prolonged period of weak operating performance.

• Cryptocurrency-related companies such as MicroStrategy (MSTR.US -4.3%), Coinbase (COIN.US -2.5%) and Block (BLSH.US -4%) are seeing declines in line with the weakening prices of Bitcoin and Ethereum and changing market sentiment.

• Furniture companies such as RH.US (-8.1%) and Wayfair (W.US; -7.5%) are experiencing significant declines following President Trump's announcement of a thorough tariff investigation into furniture imports to the US, which is increasing market uncertainty.

• Napco Security Technologies (NSSC.US) gains 16% on the back of positive financial results and exceeding analysts' expectations for adjusted EBITDA for the fourth quarter, strengthening its position in the security systems market.

• Vital Energy (VTLE.US) is up 9.3% following news of a planned acquisition by Crescent Energy (CRGY.US), which is down 6.4%, for approximately $733 million, which is significant for the energy sector and signals further market consolidation.