Tech sell-off drags global shares lower
2024-09-04
Summary:
Global stock futures and Treasury yields fell on Wednesday as a tech selloff raised concerns about the U.S. economic outlook.
Global stock futures fell on Wednesday in the wake of a tech selloff, while Treasury yields edged lower as investors fretted over the outlook for the world's largest economy.
Wall Street closed sharply lower overnight after the US returned from a holiday at the start of the week, with AI darling Nvidia tumbling nearly 10%. The tech-heavy Nikkei index slid more than 3%.
September has historically been a bad month for stocks. A slew of economic data is due throughout the week and the NFP report could decide the size of a rate cut expected this month.
A decline of 10% in the S&P 500 index before the US presidential election in November is highly likely amid uncertainties around rate cuts and corporate earnings, Morgan Stanley CIO said in July.
He maintained a bearish outlook for the majority of this year, one of few prominent forecasters to do so, citing overstretched valuations.
The VIX rose from 15.6 to 20.7, climbing above its long-term average to its highest level in three weeks. The VVIX jumped from 94 to 130, suggesting investors were wary of further volatility.
The S&P 500 has broken below 50 SMA – a sign of further losses in the upcoming sessions. The next major support lies at 5,400.
Disclaimer: This material is for general information purposes only and is not intended as (and should not be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by EBC or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.
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