Article / 13 June 2017 at 6:59 GMT

Morning Markets: US tech selloff winding down?

Editor / Saxo Bank
Denmark






Morning Markets



Watchlist

  • Spain: CPI (0700 GMT)
  • Sweden: CPI (0730 GMT)
  • UK: Monthly inflation figures, incl. CPI and PPI (0830 GMT)
  • Germany: ZEW indicator of economic sentiment (0900 GMT)
  • US: Small Business Optimism Index (1000 GMT) 
  • US: PPI (1230 GMT)
  • US: API weekly statistical bulletin, incl. crude oil stocks (2030)

US tech shares took a big hit Monday with the Nasdaq down 0.5% overall (and the sector down 5% since last Friday) as investors fled the sector. Although something of a bid had started to come in by the end of the Wall Street session, Asian tech shares largely continued the weakness seen in their US counterparts. 

European equities are expected to pen in the red today while oil prices are on the rise in response to Middle Eastern tensions. This latter development has combined with a surprisingly hawkish outing from the Bank of Canada's deputy governor to produce a sharp rally in the loonie. 

Sterling remains soft as prime minister Theresa May's difficulties in forming a government are pointing to the potential for a less-then-clear stance regarding the Brexit negotiations due to start Monday.

Market signals

Asian session

  • Japan's BSI Manufacturing Index fell 2.9 points compared with the previous quarter
  • Australia's May NAB monthly business survey came in at 7, pointing to an upbeat sector 
  • Asian markets were mixed as US tech stocks continued to be put under pressure 
  • Crown Resorts staff held in China have been charged with gambling-related offences
  • Crown is controlled by Australian billionaire James Packer
  • US Attorney General Jeff Sessions will give his testimony before a Senate panel today
  • Economists see the Fed raising its benchmark rate to between 1-1.25%this week.
  • West Texas crude futures rose 0.4% to $46.25/barrel, gaining for a third day
  • Gold was little changed at $1,266.36/oz, after four straight days of losses

Forex ahead

  • The NZD rose against the GBP, edging back toward last week's three-month high
  • GBP was steady at $1.2657, after sliding as much as 0.8% on Monday;
  • USDCAD dropped following hawkish comments from the BoC's senior deputy governor
  • The yen was little changed at 109.99 per dollar, after Monday’s 0.3% gain.

From the Floor

Rebound? "It looks like that we are getting very solid bids and smooth rise in US tech," says Garnry

New coalition "The government May is trying to build could potentially lead to a softer Brexit," says Hardy

Get all the latest from Saxo Bank's trading floors in From the Floor, within the hour.

In opinion

1... 2... 3
Today's UK CPI report is expected to show inflation stabilising, albeit at a moderately elevated pace in today's report, says James Picerno.

Pressure point
Asian markets opened mixed following pressure on the US tech sector. The Nasdaq logged its biggest two-day slide since December, explain Saxo's Singapore trading team.

Exposed
A three-week record buying spree has left gold exposed ahead of this week's Federal Open Market Committee meeting, writes Ole Hansen.

Tech volatility jumps
The Nasdaq lost 1.8% on Friday in a steep selloff of big-name technology stocks, and Nasdaq volatility spiked over 30%, writes Georgio Stoev.

Fortnum & Mason

 "Afternoon tea still under £50?" Inflation updates are due on Tuesday from several countries, including the UK, Spain and Sweden. Photo: Shutterstock

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