Following false breakouts in markets last week, downside momentum continued to build yesterday.
In particular, the weakness was centred on the tech centric parts of the equity market, including the Nasdaq100 (-2.6 per cent) and the Philly SOX (-3.8 per cent) with sharp moves lower in certain tech stocks such as Tesla (-8.5 per cent) & Apple (-3.0 per cent). The key question, therefore, is whether a near term buying opportunity in tech is now emerging, OR whether those moves will mark the start of something more sinister.
The key event today is Jerome Powell’s semi-annual testimony on Capitol Hill (which will be repeated tomorrow). That may have some impact on markets, albeit it’s already well known that Powell supports a large fiscal stimulus package.
Later today we also get US consumer confidence for February (published by the Conference Board, at 3pm London time).