Extreme Investor Network Update: Tech-Led Stock Rout Pauses as Traders Await US Inflation Data
Investors are bracing themselves as the tech-led stock rout takes a pause while awaiting key US inflation data that could shed light on whether concerns of a sharper-than-expected economic slowdown are justified. At Extreme Investor Network, we understand the importance of staying informed on market trends and economic indicators to make smart investment decisions.
Europe’s Stoxx 600 benchmark is trading little changed, set for its second consecutive weekly drop. US stock futures have edged higher, and Treasury yields remained steady after a decline on Thursday. The Japanese yen has strengthened against the dollar.
The recent tech sell-off has evolved into a broader risk-off sentiment driven by disappointing corporate results and fears of a looming US slowdown that may require aggressive interest rate cuts. Despite better-than-expected GDP data on Thursday, traders are now focusing on the upcoming monthly PCE statistics, which could influence the Federal Reserve’s decision at its next meeting.
In corporate news from Europe, Mercedes-Benz Group AG reported a 19% plunge in earnings in the second quarter due to a decline in sales of its electric vehicles and weakening demand in China. On the other hand, Eni SpA raised its full-year profit guidance.
US markets have witnessed a rapid correction, with the tech-heavy Nasdaq index dropping 8% in just 10 trading days, compared to 20 days in 2023. Meanwhile, small-cap stocks have outperformed, indicating investor expectations of imminent interest rate cuts to support the broader economy.
Some notable corporate highlights include:
– Amundi SA posted second-quarter inflows that exceeded analysts’ estimates, boosting its assets under management to a record high.
– Eni SpA reported better-than-expected second-quarter profits, prompting an upward revision of its annual guidance.
– BASF SE saw a slight decline in earnings in the second quarter due to falling prices across its chemicals business.
– NatWest Group Plc raised its full-year revenue forecast after second-quarter net interest income fell less than anticipated, showing resilience amid high interest rates.
In Asia, Taiwanese shares took a hit, declining by up to 4.3% as trading resumed after disruptions caused by Typhoon Gaemi. This drop follows previous tech-related declines in global stocks, with Taiwan Semiconductor Manufacturing Co. experiencing a significant 6.5% decline.
In other market developments:
– The yen traded below 154 per dollar, on track for its fourth daily gain in five sessions, amid accelerated inflation in Tokyo.
– Oil prices rose for a third consecutive session, supported by lower US stockpiles and subdued Chinese demand.
Stay tuned with Extreme Investor Network for more insights and analysis on market trends, economic data, and investment opportunities. Make sure to visit our website for exclusive content and expert perspectives to help you navigate the ever-changing financial landscape.