Wednesday's Market Recap - China Reiterates Opposition To Bitcoin Sending Stocks Plunging.
- May 18, 2021
- 2 min read
What is The Premarket Telling Us?
May 19, 2021 7:15 AM.
Stock futures are sharply lower at this hour, with Dow futures down 251 points, Nasdaq futures down 164 points, and S&P futures down 37 points. The markets are still grappling with fear of higher interest rates, and potential inflation. Overnight, China clamped down on the cryptocurrency complex, by prohibiting banks from dealing in Bitcoin. As a result Bitcoin and other cryptocurrencies fell hard overnight, down to $30,000 range, after being at more than $40,000 yesterday. This has cast a negative sentiment on markets, during the premarket.
On The Bond Desk:
The US 10 Year Bond Yield at 1.662%, up up two basis points.
Currency Desk:
Eurodollar: 1.21
UK Pound: 1.41
Crude Oil:
WTI crude oil futures at $64.23/barrel, down 1.92%.
On the Earnings Calendar:
Target and Lowe's reports strong quarterly earnings before the opening bell this morning.
In M&A News:
None to report
What About The Asian And European Markets?
Major Asian markets ended moderately mixed. Japan (Nikkei 225) down 1.28%, Shanghai down 0.51%, Hong Kong (Hang Seng) up 1.42%.
Major European markets ended their sessions lower. German (DAX) down 1.77%, France CAC 40 down 1.43%, London FTSE 100 down 1.19%.
Market And Sector Dynamics
Stocks sold off hard at today markets open, with the Dow down 381 points, Nasdaq down 227 points, and the S&P down 55 points. WTI crude oil was also down at $63.70/barrel, down 2.73%, and the US 10 Year Bond hovered at 1.624%. Negative sentiment around bitcoin, and other cryptocurrencies dominated markets today, after China reiterated that it banks would not be able to engage in crypto transactions. That sent Bitcoin plunging lower, along with a broad section of the markets. This, along with the lingering fear of rising interest rates, and inflation.
Markets traded lower for the entire trading session, with the Dow down 587 at the low of the day during the morning session. Stock rebound off the morning lows, to recover most of the losses in the afternoon, but not enough to finish in positive territory. The Nasdaq which was also lower in the morning, also rebounded, and was positive for a brief moment shortly before the close, ended just below the flat line.
Nine of eleven S&P sectors closed ended the day with losses, led by Energy, Basic Materials, Consumer Discretionary, Financials, Industrials, Real Estate, Consumer Staples, Utilities, and Healthcare. Technology, and Communication Services were modestly higher.
Factors Influencing Today's Market
China reiterates its not a fan of Bitcoin or other cryptocurrencies sends market plunging today.
US 10 Year Bond Yield closed today at 1.676%, up 2.19%.
WTI crude oil closed today at $63.37/barrel, down 3.24%.
Asian markets ended mixed, while European markets ended lower.
Minutes of the Fed last meeting suggest they are cautiously optimistic about the economic recovery.
Market Close Volume Traded And Advance Decline Ratio
At the end of trading the major indexes were lower. The Dow lost 164.62 points, Nasdaq sank 3.90 points, and the S&P lost 12.15 points. Total NYSE volume traded, a modest 4.28 billion shares. Declining shares outpaced Advancing shares by 2:1.
Data Sources: Bloomberg, CNBC, CNN Money, Google Finance, Market Watch, TD Ameritrade, Yahoo Finance.
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