The overnight performance of Dow Jones eked out a marginal gain of 0.15% or 48.38 points at 31,928.62 vis-a-vis the sharp fall of Nasdaq (down 2.35% or 270.83 points @ 11,264.45) after Snapchat slashed guidance, citing worsening macroeconomic climate.
Meanwhile, Dow Jones futures rose modestly overnight, along with S&P 500 futures and Nasdaq futures.
While, the local equities market is expected to whipsaw in a choppy manner amid the volatile regional and global stocks markets . The key index is expected hover around the range of 1,535 point level (+/-10 points) for the remaining week. There might be the possibility of bargain hunting on counters with strong fundamentals and attractive valuations.
As for regional markets, the key indices are expected to trend lower as investors remained cautious over the uncertain global economic outlook and monetary policies to be implemented by the major central bankers around the world.
On yesterday’s closing, global shares skidded as supply chain woes and surging costs hurt corporate earnings and slowing manufacturing output or activities. U.S. and euro zone business activity slowed in May. S&P Global attributed the decline in its U.S. Composite PMI Output to “elevated inflationary pressures, a further deterioration in supplier delivery times and weaker demand growth.”
The weakness in equities has spurred a safe-haven bid for U.S. government debt, hence the treasury yields lowered.
Growth forecasts for US corporates remain on the cautious as freight and product costs weigh on corporate earnings results. On top of that, the US Federal Reserve seemed certain to hike interest rates by a full percentage point over the next two months.
