Nasdaq 100 in Cautious Mood as Yields Climb, Hang Seng Index May Rise

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  • Dow Jones, S&P 500 and Nasdaq 100 closed -0.56%, +0.08%, and +0.75% respectively on Friday
  • US 10-year Treasury yields reached 2-year excessive, weighing on the know-how sector
  • Asia-Pacific markets look set to open modestly increased. US markets will reopen after a vacation

Nasdaq 100, Hang Seng Index, Treasury Yield, BOJ, Asia-Pacific on the Open:

US markets will resume buying and selling on Tuesday after a break. Investors will proceed to observe banks’ earnings for clues about rising prices and better web curiosity margin down the street. Last week, JPMorgan and Citigroup introduced disappointing outcomes as they each highlighted price ‘headwinds’ and moderating Wall Street Revenue. Today, GoldmanSachs will launch its This autumn earnings.

The fee of 10-year US treasuries climbed to a recent two-year increased of 1.81%, exerting downward stress on equities as bonds provide an alternative choice to threat property. Treasury yields are considered as risk-free benchmark, which is able to have an effect on charges on bonds and different property. Higher yields translate into rising borrowing prices for leveraged corporates and people, probably squeezing their revenue margin. This renders the Nasdaq 100 index extra inclined to promoting in comparison with the Dow Jones, as many tech firms are extremely leveraged and don’t generate constructive money move.

US 10-Year Treasury Yield

Chart created with TradingView

Asia-Pacific markets look set to commerce increased following a constructive lead from European markets. A string of upbeat information from Japan and China boosted sentiment on Monday, underscoring resilience of the world’s second- and third- largest financial system in opposition to the headwind of the Omicron variant. China’s central financial institution, the PBOC, minimize the borrowing price of 1-year MLF by 10 bps, exceeding market expectations.

Futures in Japan, mainland China, Australia, Hong Kong, Taiwan, Singapore, Thailand and Indonesia are within the inexperienced, whereas these in South Korea, Malaysia and India are within the purple.

Looking forward, the BoJ rate of interest resolution dominates the financial docket alongside UK jobs report and German ZEW financial sentiment index. Find out extra from theDailyFX financial calendar.

Hong Kong’s Hang Seng Index (HSI) fell 0.68% on Monday, with know-how shares main the decline. Hong Kong shares have largely lagged behind world friends all through 2021. Many buyers are eyeing them for discount searching, together with mainland buyers. Exchange information confirmed that HKD 1.46 billion have flowed into the Hong Kong market on Monday by way of inventory connections, marking a ninth consecutive session of web influx (chart beneath).

Southbound Flow vs. Hang Seng Index

Nasdaq 100 in Cautious Mood as Yields Climb, Hang Seng Index May Rise

Source: Bloomberg, DailyFX

Nasdaq 100 IndexTechnical Analysis

The Nasdaq 100 index dangers breaching beneath a key assist degree of 15,550 – the decrease sure of the range-bound zone it traded over the previous few months. Failing to carry above this degree would convey the following assist degree of 15,310 after which 14,800 into focus. The MACD indicator is trending decrease, suggesting that downward momentum could also be prevailing.

Nasdaq 100 IndexDaily Chart

Nasdaq 100 in Cautious Mood as Yields Climb, Hang Seng Index May Rise

Chart created with TradingView

Hang Seng Index Technical Analysis

The Hang Seng Index (HSI) is making an attempt to breach a “Falling Wedge” sample from the upside, as highlighted within the chart beneath. A profitable try could sign a bullish pattern reversal and open the door for additional features. Prices have pulled again to the higher trendline searching for instant assist. The MACD indicator is trending increased beneath the impartial midpoint, suggesting that bullish momentum could also be constructing.

Hang Seng Index – Daily Chart

Nasdaq 100 in Cautious Mood as Yields Climb, Hang Seng Index May Rise

Chart created with TradingView

ASX 200 Index Technical Analysis:

The ASX 200 index pulled again to a range-bound zone between 7,200 to 7,500 after a ‘false breakout’ final week. The flooring and ceiling of the vary could also be considered as instant assist and resistance ranges respectively. The total pattern stays bullish-biased, as costs shaped consecutive increased highs and better lows over the previous three months. A significant breach above 7,500 could intensify shopping for stress and expose the following resistance degree of seven,760.

ASX 200 IndexDaily Chart

Nasdaq 100 in Cautious Mood as Yields Climb, Hang Seng Index May Rise

Chart created with TradingView

— Written by Margaret Yang, Strategist for

To contact Margaret, use the Comments part beneath or @margaretyjy on Twitter

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