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1. The three major U.S. stock indexes closed slightly higher. The Dow Jones Industrial Average rose 0.36% to 46,669.88 points, the S&P 500 rose 0.44% to 6,611.83 points, and the Nasdaq Composite rose 0.54% to 21,996.34 points. Boeing rose nearly 2%, and American Express rose more than 1%, leading the Dow Jones gains. The Wind U.S. Tech Seven Giants Index rose 0.42%, with Amazon and Google rising more than 1%. The Nasdaq China Golden Dragon Index fell 0.21%, with BaWangChaJi rising more than 3% and iQiyi falling more than 4%. 2. Major Asia-Pacific stock indexes closed higher across the board. The Nikkei 225 rose 0.55% to 53,413.68 points. The South Korean KOSPI rose 1.36% to 5,450.33 points. The Indian SENSEX 30 rose 1.07% to 74,106.85 points. 3. The WTI crude oil futures contract closed up 0.96% at $112.61 per barrel; the Brent crude oil futures contract rose 0.61% to $109.7 per barrel. 4. International precious metals futures generally closed lower. COMEX gold futures fell 0.08% to $4676.10 per ounce, and COMEX silver futures fell 0.15% to $72.81 per ounce. 5. US Treasury yields were mixed. The 2-year Treasury yield rose 2.06 basis points to 3.850%, the 3-year Treasury yield rose 0.57 basis points to 3.874%, the 5-year Treasury yield was unchanged at 3.983%, the 10-year Treasury yield fell 1.00 basis point to 4.333%, and the 30-year Treasury yield fell 2.35 basis points to 4.886%.Market news: The Artemis 2 mission crew has reached its closest point to the moon.Samsung Electronics: First-quarter revenue is expected to be 133 trillion won (institutional estimates are 119.2 trillion won).Samsung Electronics: First-quarter operating profit is expected to be 57.2 trillion won (institutional estimates are 40.6 trillion won).Market news: Saudi Arabia shot down four Iranian ballistic missiles.

S&P 500 (SPY) Moves Towards 3900 As Chip Stocks Retreat

Alice Wang

Sep 02, 2022 14:52

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Stocks fell towards the 3900 mark as a result of concerns about the Fed's aggressive rate rises and the sale of advanced chips to China being prohibited by the United States.


The U.S. dollar reached new highs as a result of the positive ISM Manufacturing PMI report. The yield on Treasury bonds has also increased. According to the FedWatch Tool, there is a 76% chance that the next meeting will result in a 75 basis point rate increase, which is bad news for the stock market.


Interestingly, RSI is still in the moderate range despite the significant drop, suggesting that there is still opportunity for more downward momentum in the future trading days.


The S&P 500 will go toward the next support level at 3875 if it is able to settle below the support at 3915. If the S&P 500 drops below this level, it will be forced toward the 3830 support level.


The previous support level at 3950 will act as the first resistance level for the S&P 500 on the upside.


The S&P 500 will go toward the barrier at 3980 if it is able to stabilize again above this level.

Trades In Defensive Sectors Show Some Interest

Because of concerns that the U.S. export prohibition would significantly hurt the company's sales, NVIDIA stock is down roughly 12%. AMD's decline is 7%. The pricey and complex processors used in AI development are the focus of the prohibition.


The market is concerned that other limitations may be imposed in the future and that the ban is just the start of a multi-year campaign against China's high-tech capabilities.


Chinese equities like Alibaba and NIO have come under significant pressure as ties between the U.S. and China continue to worsen.


The prices of top tech companies like Apple, Microsoft, and Alphabet are also declining today.


After the sharp drop, investors are looking for safe-haven investments, and while equities like Johnson & Johnson, Walmart, and Philip Morris are rising, they are doing so.


The trading patterns of these equities should be monitored by traders since their recovery may indicate that following the sell-off in the S&P 500, buyers' interest is increasing.

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