U.S. equity index futures red; Nasdaq 100 down >1.5%
Initial jobless claims 221k vs 235k estimate
Jan international trade -$131.4B vs -$127.4B estimate
Euro STOXX 600 index off ~0.6%
Dollar, bitcoin, gold down; crude gains
U.S. 10-Year Treasury yield edges up to ~4.28
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NASDAQ COMPOSITE: IS THERE AN OFF RAMP ON THE CORRECTION HIGHWAY?
During Tuesday's and Wednesday's sessions, the Nasdaq Composite .IXIC briefly fell into correction territory. However, a significant support level on the weekly charts was able to provide a detour, allowing the composite to u-turn back to the upside:
On Tuesday, the IXIC hit an intraday low of 17,956.60, putting it down 11% from its 20,173.89 December 16 record closing high. (18,156.501 is a 10% correction from its record close).
On Wednesday, the IXIC fell to an intraday low of 18,144.73, putting it down 10.1% from its record close.
With its weakness over the past two days, the composite flirted with its rising 50-week moving average $(WMA.AU)$, which is now around 18,070.
Of note, in the wake of the IXIC's late-2021 peak, the 50-WMA, once broken, capped strength into the market's 2022 bear-market lows. And since it was reclaimed on a weekly closing basis in March 2023, the 50-WMA acted as a launching pad for a resumption of Nasdaq strength that began in October 2023 and August 2024.
With the tests of its 50-WMA, the composite has been able to stabilize. It finished Tuesday at 18,285.16, and then rallied Wednesday, ending at 18,552.73, putting it down 8.04% from its record close.
That said, with e-mini Nasdaq 100 futures NQcv1 tumbling more than 1.5% in premarket trade on Thursday, the composite appears poised to come under heavy downside pressure at the open, and once again threaten correction territory.
The 50-WMA has been resilient, but on a break of Tuesday's low, the channel support line from the late-2022 low, which is now around 17,650, may be the next magnet. It's now around 12.5% below the record close.
On an upward reversal, there is resistance in the 18,671-18,831 area.
(Terence Gabriel)
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FOR THURSDAY'S EARLIER LIVE MARKETS POSTS:
RECESSION THREATS RISING- MERCER - CLICK HERE
GERMANY'S FISCAL OVERHAUL COULD BUFFER EUROZONE IF US TARIFFS MATERIALISE - UBS - CLICK HERE
LUXURY: ARE WE OUT OF THE WOODS? - CLICK HERE
STOXX SLIPS DESPITE MODERATING TARIFF FEARS AND POSITIVE EARNINGS - CLICK HERE
EUROPE BEFORE THE BELL: FUTURES UP AS TARIFF TENSIONS EASE - CLICK HERE
ECB'S LAST EASY DECISION - CLICK HERE
IXIC03062025 https://tmsnrt.rs/3Xxxpph
(Terence Gabriel is a Reuters market analyst. The views expressed are his own)
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