Brace for fallout from a megacap-led wipe out. A rethink of the earnings picture for hyped up AI and Magnificent seven stocks turned a run on Alphabet and Tesla into a Wall Street rout.
Combine that with concerns about Chinese and global growth that heaped pressure on commodity linked currencies and you have the makings for the risk-off mood in China’s markets, and Japan’s, to continue
Today’s Market News
- Exclusive: Big Chinese fund managers cap pay, claw back excess in ‘common prosperity’ push, sources say
- Automaker Honda to slash gas cars production capacity in China, Nikkei says
- Otis cuts annual sales view on slowdown in construction activity in China, US
- Japan to resume funding for stalled projects in Sri Lanka, envoy says
The S&P 500 and Nasdaq skidded to multi-week lows on Wednesday after Tesla <TSLA.O> and Alphabet <GOOGL.O> disappointed with lackluster earnings and their shares tumbling 12% and 5%, respectively.
The tech-heavy Nasdaq <.IXIC> ended 3.6% lower and the S&P 500 <.SPX> fell 2.3%. Other megacaps, Apple (AAPL.O), Microsoft (MSFT.O), Amazon.com (AMZN.O), Meta Platforms (META.O) and Nvidia (NVDA.O), took it on the chin, as did small caps <.RUT>, which enjoyed a brief moment in the sun in recent weeks.
The dollar fell to its lowest in more than two months against the yen as short-yen carry trades were unwound ahead of next week’s Bank of Japan meeting. That coincides with the July 30-31 FOMC meeting. While the Fed is unlikely to pull the trigger on easing this month, a scenario in which yield differentials soon narrow from both sides is being built in.
For more news, visit Reuters.com
