Key Points
- Negative sentiment coming from China as stimulus promise fails to impress.
- NASDAQ is ignoring concerns about the semiconductor industry for now.
- Retail sales are expected to grow from last month as the US economy outlook remains strong.
- NASDAQ looks ready to test all-time highs as traders are cashing in on the recent dip.
Market Overview
Global stocks have had a mixed start to the week. The buoyant mood in China has been dampened somewhat, with the CHN50 giving back more than half of the gains seen since the announcement of the stimulus package. People are now wondering if this is enough, and there are fears the desired impact of the stimulus may not be met.
There has been some choppy price action in US stocks, with the NASDAQ starting the week on the back foot. This could be down to traders taking profits ahead of earnings season for the “Magnificent Seven.” However, traders are cashing on the dip as of this morning. Here is everything you need to know for the remainder of the week and early next week.
NASDAQ Ignores Semiconductor Concerns
ASML Holding, a semiconductor company, surrendered its title as Europe’s most valuable technology company after it lost $50bn from its share price. The influential chip maker warned of a slower recovery in the semiconductor industry, and Chief executive Christophe Fouquet warned of “customer cautiousness.”
This sparked a daily rout in the tech space and spooked the NASDAQ. The biggest concern is that this is expected to continue in 2025 and shows the vulnerability of this market to any negative news after a tech buying frenzy in recent years. The NASDAQ has since recovered, but this is a story to keep monitoring over the next few months.
Retail Sales To Prove A Resilient US Economy?
This afternoon, retail sales are due out in the US. Month-on-month retail sales are expected to grow to 0.3%, beating last month’s 0.1%. The core retail sales figure is expected to be 0.1%. Furthermore, weekly Unemployment Claims data is due out, with fewer claims expected than last week.
Should this data ring true, it could provide another boost to the NASDAQ and help provide evidence that the US economy is not going into a recession soon. Any figures below the estimate in retail sales could show a short-term tech sell-off.
NASDAQ To Test All-Time Highs?
While the US30 and S&P500 have been roaring past all-time highs, it feels like only a matter of time until this level is tested in the NASDAQ, too. The current price is 20,330, and it is over halfway to recovering from the slump seen on Tuesday.
Yesterday, the NASDAQ grabbed the liquidity from the tight consolidation period circled on the chart. Since then, the market has reacted strongly and is heading towards a minor bearish order block. There could be some resistance from here, but it may only be short-lived, and instead, it is more likely the price will test 20,500 and beyond.
Risk Disclosure: The information provided in this article is not intended to give financial advice, recommend investments, guarantee profits, or shield you from losses. Our content is only for informational purposes and to help you understand the risks and complexity of these markets by providing objective analysis. Before trading, carefully consider your experience, financial goals, and risk tolerance. Trading involves significant potential for financial loss and isn’t suitable for everyone.
