Nasdaq Poised to Rise with Hang Seng, ASX 200. Apple Earnings in Focus

NASDAQ 100, HANG SENG, ASX 200 INDEX OUTLOOK:

  • Nasdaq 100 futures are advancing in afterhours trade on earnings optimism, weaker US Dollar
  • Facebook and Apple climbed as investors anticipated strong Q4 earnings release
  • Asia-Pacific markets are poised for a rebound after suffering heavy selling on Tuesday

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Nasdaq 100, Apple, Facebook earnings, Asia-Pacific at Open:

US equity futures advanced on Wednesday morning, led by the Nasdaq 100 index ahead of big tech earnings from Apple, Facebook and Tesla. The US Dollar Index retreated from a one-week high while the 10-year US Treasury yield rose slightly to 1.04%, alleviating pressure over risk assets. Improving sentiment and earnings optimism may encourage a rebound in Asia-Pacific equities today.

Reflation trades appeared to have lost their momentum recently due to covid-related lockdowns and uncertainties brought about by mutant viral strains. As a result, energy and materials sectors have lagged behind information technology as the latter appeared to have more earnings certainty during lockdown times. On the positive front, US daily Covid-19 new cases have fallen to 133,913 on January 25th, marking the lowest reading since November 15th. The 7-day moving average of daily cases has also been declining with the rollout of coronavirus vaccines (chart below).

Daily Trends in US Covid-19 Cases

Nasdaq Poised to Rise with Hang Seng, ASX 200. Apple Earnings in Focus

Source: covid.cdc.gov

US corporate earnings continued to fare well, with more than 83% of S&P 500 companies beating market estimations so far this season. Last night, 26 out of 31 companies, including Microsoft, 3M and America Express delivered positive EPS surprises whereas General Electric disappointed.

Looking ahead, Facebook and Apple’s Q4 results today will be closely watched by investors and may set the tone for broader market sentiment. Consensus shows that the street is expecting Apple’s Q4 2020 EPS to come in at US$ 1.417, up by 13.6% YoY due to strong 5G iPhone and Mac sales in the fourth quarter. Facebook’s Q4 EPS is expected to reach a record high of US$ 3.54, marking a 38.2% YoY growth. Both Apple and Facebook share prices advanced more than 1 percent in after-hour trade, lifting the Nasdaq 100 futures higher. More earnings information can be found in the calendar at the end of the article.

Sector-wise, 4 out of 9 Dow Jones sectors advanced on Tuesday, with 46.7% of the index’s constituents closing in the green. Defensive-linked consumer staples (+1.08%), information technology (+0.82%) and industrials (+0.44%) were among the best performers, whereas materials (-2.60%), communication services (-1.81) and energy (-1.69%) trailed behind.

Dow Jones Sector Performance 26-01-2021

Nasdaq Poised to Rise with Hang Seng, ASX 200. Apple Earnings in Focus

Source: Bloomberg, DailyFX

Asia-Pacific markets look set to erase some of Tuesday’s losses and trade higher. The Hang Seng Index may attempt for a rebound after losing 2.5% in the previous day. On Tuesday, southbound net capital flows via the stock connections receded to HK$ 13.9 billion from HK$ 19.2 billion seen on Monday, reflecting cooling appetite from mainland investors as the tech stocks are getting more and more expensive. 30,000 remains a key psychological resistance for the index.

Australia’s ASX 200 Index opened 0.52% lower, dragged by energy (-2.7%), materials (-2.67%) and healthcare (-0.85%) sectors, while consumer staples (+1.16%), financials (+0.64%) and information technology (+0.53%) are leading. Metal & mining giant Fortescue (-6.32%), Rio Tinto (-3.38%) and BHP Group (-2.4%) are among the hardest hit.

ASX 200 Top 10 Stocks Performance at Open 26-01-2021

Nasdaq Poised to Rise with Hang Seng, ASX 200. Apple Earnings in Focus

Source: Bloomberg, DailyFX

Nasdaq 100 Index Technical Analysis:

Technically, the Nasdaq 100 index looks set to continue its upward trajectory within the “Ascending Channel” as highlighted in the chart below. The bull trend remains intact and is well-supported by its 20-Day Simple Moving Average (SMA) line. Widening Bollinger Band width points to strong upward momentum, while the RSI indicator flags risk of overbought. Immediate support and resistance levels can be found at 13,360 (127.2% Fibonacci extension) and 13,860 (161.8% Fibonacci extension) respectively.

Nasdaq 100 Index – Daily Chart

Nasdaq Poised to Rise with Hang Seng, ASX 200. Apple Earnings in Focus

Hang Seng Index Technical Analysis:

The Hang Seng index is facing a strong resistance zone between 29,870 to 30,000 and has since entered a consolidative period. Breaching the psychological level of 30,000 may open the door for further upside potential with an eye on 30,930 – the 161.8% Fibonacci extension. The MACD indicator is about to form a “Death Cross”, which suggests that a near-term pullback is more likely.

Hang Seng IndexDaily Chart

Nasdaq Poised to Rise with Hang Seng, ASX 200. Apple Earnings in Focus

ASX 200 Index Technical Analysis:

The ASX 200 index is range-bound between 6,575 to 6,810 since late November, as highlighted in the chart below. The price is attempting to breach the upper bound of 6,810, and a successful attempt may open the door for further upside potential with an eye on 6,900. The overall trend remains bullish-biased, as suggested by upward-sloped simple moving average lines.

ASX 200 Index – Daily Chart

Nasdaq Poised to Rise with Hang Seng, ASX 200. Apple Earnings in Focus

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S&P 500 Earnings Calendar – 26-27thJan 2021

Name

Date

Period

Actual

Estimate

Surprise

Polaris Inc

26/1/2021

Q4 20

3.34

2.885

15.80

Stride Inc

26/1/2021

Q2 21

0.60

0.493

20.90

General Electric Co

26/1/2021

Q4 20

0.08

0.092

(13.00)

Xerox Holdings Corp

26/1/2021

Q4 20

0.58

0.628

(7.60)

DR Horton Inc

26/1/2021

Q1 21

2.14

1.707

25.40

3M Co

26/1/2021

Q4 20

2.38

2.154

10.50

Johnson & Johnson

26/1/2021

Q4 20

1.86

1.825

1.90

Invesco Ltd

26/1/2021

Q4 20

0.72

0.568

26.80

Raytheon Technologies Corp

26/1/2021

Q4 20

0.74

0.695

6.50

Verizon Communications Inc

26/1/2021

Q4 20

1.21

1.168

3.60

American Express Co

26/1/2021

Q4 20

1.76

1.287

36.80

Rockwell Automation Inc

26/1/2021

Q1 21

2.38

1.882

26.50

Archer-Daniels-Midland Co

26/1/2021

Q4 20

1.21

1.077

12.30

Lockheed Martin Corp

26/1/2021

Q4 20

6.38

6.416

(0.60)

NextEra Energy Inc

26/1/2021

Q4 20

0.40

0.397

0.80

NextEra Energy Partners LP

26/1/2021

Q4 20

0.84

0.532

58.50

Freeport-McMoRan Inc

26/1/2021

Q4 20

0.39

0.371

5.10

Prologis Inc

26/1/2021

Q4 20

0.95

0.923

2.90

Alaska Air Group Inc

26/1/2021

Q4 20

(2.55)

(2.894)

11.90

PACCAR Inc

26/1/2021

Q4 20

1.17

1.206

(3.00)

Texas Instruments Inc

26/1/2021

Q4 20

1.69

1.332

26.90

Maxim Integrated Products

26/1/2021

Q2 21

0.73

0.68

7.40

Microsoft Corp

26/1/2021

Q2 21

2.03

1.635

24.20

Starbucks Corp

26/1/2021

Q1 21

0.61

0.554

10.10

F5 Networks Inc

26/1/2021

Q1 21

2.59

2.442

6.10

Capital One Financial Corp

26/1/2021

Q4 20

5.29

2.94

79.90

Varian Medical Systems Inc

26/1/2021

Q1 21

1.14

1.047

8.90

W R Berkley Corp

26/1/2021

Q4 20

0.92

0.78

17.90

Advanced Micro Devices Inc

26/1/2021

Q4 20

0.52

0.471

10.40

CH Robinson Worldwide Inc

26/1/2021

Q4 20

1.08

0.97

11.30

Boston Properties Inc

26/1/2021

Q4 20

1.37

1.587

(13.70)

Amphenol Corp

27/1/2021

Q4 20

1.026

Progressive Corp/The

27/1/2021

Q4 20

1.685

Prosperity Bancshares Inc

27/1/2021

Q4 20

1.344

Corning Inc

27/1/2021

Q4 20

0.485

Automatic Data Processing

27/1/2021

Q2 21

1.289

Norfolk Southern Corp

27/1/2021

Q4 20

2.468

Rollins Inc

27/1/2021

Q4 20

0.112

Hess Corp

27/1/2021

Q4 20

(0.659)

Abbott Laboratories

27/1/2021

Q4 20

1.356

Boeing Co/The

27/1/2021

Q4 20

(2.059)

MarketAxess Holdings Inc

27/1/2021

Q4 20

1.821

Textron Inc

27/1/2021

Q4 20

0.911

Anthem Inc

27/1/2021

Q4 20

2.516

Blackstone Group Inc/The

27/1/2021

Q4 20

0.912

General Dynamics Corp

27/1/2021

Q4 20

3.552

Teledyne Technologies Inc

27/1/2021

Q4 20

3.17

Brinker International Inc

27/1/2021

Q2 21

0.298

VF Corp

27/1/2021

Q3 21

0.90

AT&T Inc

27/1/2021

Q4 20

0.727

Nasdaq Inc

27/1/2021

Q4 20

1.454

Packaging Corp of America

27/1/2021

Q4 20

1.468

Facebook Inc

27/1/2021

Q4 20

3.231

Lam Research Corp

27/1/2021

Q2 21

5.722

Hologic Inc

27/1/2021

Q1 21

2.17

Tesla Inc

27/1/2021

Q4 20

1.011

Ameriprise Financial Inc

27/1/2021

Q4 20

4.468

Crown Castle International

27/1/2021

Q4 20

1.572

Apple Inc

27/1/2021

Q1 21

1.417

Edwards Lifesciences Corp

27/1/2021

Q4 20

0.532

United Rentals Inc

27/1/2021

Q4 20

4.241

PTC Inc

27/1/2021

Q1 21

0.658

Duke Realty Corp

27/1/2021

Q4 20

0.406

ServiceNow Inc

27/1/2021

Q4 20

1.06

Raymond James Financial Inc

27/1/2021

Q1 21

1.68

Cree Inc

27/1/2021

Q2 21

(0.247)

Las Vegas Sands Corp

27/1/2021

Q4 20

(0.316)

SL Green Realty Corp

27/1/2021

Q4 20

1.556

Stryker Corp

27/1/2021

Q4 20

2.542

Whirlpool Corp

27/1/2021

Q4 20

6.176

Xilinx Inc

27/1/2021

Q3 21

0.678

Teradyne Inc

27/1/2021

Q4 20

0.999

Source: Bloomberg

— Written by Margaret Yang, Strategist for DailyFX.com

To contact Margaret, use the Comments section below or @margaretyjy on Twitter

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