- Equity markets struggled on Wednesday, especially Nasdaq.
- Meta Platforms 20%+ sell-off is not helping tech sector.
- Consumer spending looks decent with Visa earnings.
Equity markets took a pause on Wednesday as risk appetites were partially sated after the last rally. Equity markets have moved off the lows to the tune of about 10% based on hopes for a Fed pivot. Earnings season continues to reveal that consumers are holding up ok, while corporates are pulling back. This is most clearly visible in big tech with ad spending hitting Alphabet (GOOGL) and Meta Platforms (META), while Visa (V), Pepsi (PEP), Coca-Cola (KO), and a host of others continue to see good pricing pressure pass through. It appears to confirm this is the inflationary slowdown phase of an impending inflationary recession.
S&P 500 (SPY) (SPX) (US500) news
Overnight META has put another spanner in the works with it slumping alarmingly. Earnings were not so bad with an actual revenue beat, but the outlook for costs and margins led to the sharp sell-off. Now only Apple (AAPL) and Amazon (AMZN) await to stem the tide of dismal tech earnings. All eyes though will turn to the macro side of the equation first when we get US GDP. The latest data of 2.6% is just about in-line to ensure plenty for both hawks and doves to argue over.
All eyes now turn to Apple earnings after the close. Is the iPhone 14 selling well or not, and how are margins holding up? We also get Amazon after the close. So far the market appears dovish in my view for the ECB, and yields and the euro are moving down. Meanwhile, oil is higher on the in-line US GDP figure. For stocks, this means more indecision and a likely pause until Apple. The current trend appears to be consumer companies good and big tech bad. Apple is a bit of both but for the high-end consumer.
S&P 500 (SPY) (SPX) (US500) forecast
The double top and resistance at $389 for SPY remain in place. The pivot is at $379 for this rally. Apple stock is likely to see a retracement day continue as META weighs on sentiment.
SPY daily chart
SPX daily chart
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD stays near 1.0400 in thin holiday trading
EUR/USD trades with mild losses near 1.0400 on Tuesday. The expectation that the US Federal Reserve will deliver fewer rate cuts in 2025 provides some support for the US Dollar. Trading volumes are likely to remain low heading into the Christmas break.
GBP/USD struggles to find direction, holds steady near 1.2550
GBP/USD consolidates in a range at around 1.2550 on Tuesday after closing in negative territory on Monday. The US Dollar preserves its strength and makes it difficult for the pair to gain traction as trading conditions thin out on Christmas Eve.
Gold holds above $2,600, bulls non-committed on hawkish Fed outlook
Gold trades in a narrow channel above $2,600 on Tuesday, albeit lacking strong follow-through buying. Geopolitical tensions and trade war fears lend support to the safe-haven XAU/USD, while the Fed’s hawkish shift acts as a tailwind for the USD and caps the precious metal.
IRS says crypto staking should be taxed in response to lawsuit
In a filing on Monday, the US International Revenue Service stated that the rewards gotten from staking cryptocurrencies should be taxed, responding to a lawsuit from couple Joshua and Jessica Jarrett.
2025 outlook: What is next for developed economies and currencies?
As the door closes in 2024, and while the year feels like it has passed in the blink of an eye, a lot has happened. If I had to summarise it all in four words, it would be: ‘a year of surprises’.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.