Nasdaq falls but Dow starts in green as oil prices rebound on fresh US-Iran fighting
10am: Dow opens higher but Nasdaq falls
It’s a mixed open for Wall Street, with investors switching out of tech and buying more defensive names ahead of earnings season and some other market moving events later this week.
The Dow Jones has opened up 0.3%, helped by gains from the likes of Salesforce, Chevron and Apple.
The S&P 500 slipped 0.3%, while the Nasdaq fell almost 1% as chipmakers led the declines.
Top fallers on the tech-laden index are SanDisk, Arm Holdings, Western Digital, Micron and Marvell, all dropping over 7%, with Nvidia also trading 1.4% lower, as investors take profits across the semiconductor sector.
8.25am: Nasdaq tipped to drop, as oil rebounds further
US stocks are set for a weaker start to the week after last week finished on a positive note, with technology shares expected to come under the most pressure as investors balanced renewed geopolitical tensions against a busy week for inflation data and the start of bank earnings season.
Nasdaq futures were down 1.0% early on Monday, while S&P 500 futures were down 0.4% and Dow Jones futures were sitting just 0.1% lower.
The pullback follows a solid week; the S&P 500 gained more than 1%, the Nasdaq rose 0.9% and the Dow added 0.4%.
Monday saw oil prices climb after the US confirmed fresh military strikes on Iran aimed at reducing Tehran’s ability to attack commercial shipping in the Strait of Hormuz.
WTI crude rose 3.5% to $73.94 a barrel, having briefly traded above $75 in the early hours.
Iran said the ceasefire was in a “crisis phase” and warned it could abandon the agreement if Washington failed to meet its commitments, maintaining that efforts with Oman to establish a mechanism for managing the strategic waterway were being hampered by the US.
The rise in oil prices weighed heavily on Asian technology stocks. South Korea’s Kospi slumped almost 9%, with memory chip maker SK Hynix dropping 13% despite its strong debut on Wall Street last week, while Japan’s Nikkei lost 1.9%.
European markets were roughly flat, with London’s FTSE 100 down 0.3% and benchmarks for Germany and France broadly unchanged.
Investors are now turning their attention to Tuesday’s US inflation report and Federal Reserve chair Kevin Warsh’s testimony to Congress. Although economists expect headline inflation to ease slightly, higher energy prices have raised doubts over how much comfort policymakers will take from the data.
Earnings season also gathers pace this week, starting with results from several major US banks tomorrow.