Asia Morning July 24

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By :  ,  Financial Analyst

Asia Morning: Tech Shares Lead US Market Sell-off

On Thursday, U.S. stocks encountered a sell-off. The Dow Jones Industrial Average fell 353 points (-1.31%) to 26652, the S&P 500 dropped 40 points (-1.23%) to 3235, and the Nasdaq 100 slumped 290 points (-2.67%) to 10580.

Nasdaq 100 Index: Daily Chart

Source: GAIN Capital, TradingView

Market sentiment was dampened by a spike in unemployment claims and worries of a new round of lockdowns amid rising coronavirus cases.

Technology Hardware & Equipment (-3.26%), Software & Services (-2.55%) and Retailing (-2.48%) sectors lost the most. Citrix Systems (CTXS -12.93%), Allegion Plc (ALLE -8.10%), Align Technology (ALGN -5.95%) and Chipotle Mexican Grill (CMG -5.42%) were the top losers.

On the technical side, about 57.0% (53.4% in the prior session) of stocks in the S&P 500 Index were trading above their 200-day moving average, and 89.3% (87.5% in the prior session) were trading above their 20-day moving average.

In after-marker hours, Intel (INTC -1.06%) posted second quarter adjusted earnings per share of $1.23 (beating expectations) while warning of further delays in development of its superfast seven-nanometer chip technology.

U.S. official data showed that Initial Jobless Claims rose to 1.416 million for the week ended July 18 (1.300 million expected), while Continuing Claims unexpectedly fell to 16.197 million for the week ended July 11 (17.100 million expected).

The Conference Board Leading Index increased 2.0% on month in June (+2.1% expected).

Due later today are reports on Markit U.S. Manufacturing Purchasing Managers' Index (a rise in July preliminary reading to 52.0 expected) and New Homes Sales (an increase in June annualized rate of 700,000 units expected).

European stocks were little changed. The Stoxx Europe 600 Index, Germany's DAX 30, France's CAC 40 and the U.K.'s FTSE 100 were all broadly flat at close.

The benchmark U.S. 10-year Treasury yield remained under pressure drifting lower to 0.581%.

Spot gold price advanced a further $16.00 (+0.9%) to $1,887 an ounce extending its winning streak to a fifth session. On the other hand, spot silver retreated 1.8% to $22.59 an ounce halting a four-day rally.

U.S. WTI crude oil futures (August) lost 2.0% to settle at $41.07 a barrel.

On the forex front, the ICE U.S. Dollar Index fell 0.2% on day to 94.78, down for a fifth straight session.

EUR/USD rose 0.3% to 1.1600, posting a five-day rally. Official data showed that the eurozone's Consumer Confidence Index slipped to -15.0 in July (-12.0 expected) from -14.7 in June. On the other hand, Research firm Markit will release the eurozone's July Manufacturing PMI (50.1 expected) and Services PMI (51.0 expected) later in the day.

GBP/USD was little changed at 1.2736. Later today, the Markit U.K. Manufacturing PMI (52.0 expected) and Services PMI (51.5 expected) for July will be reported.

USD/JPY dropped 0.3% to 106.85.

AUD/USD lost 0.5% to 0.7103.

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