NASDAQ Leads E-Mini Losses Into Cash Open

E-minis are lower into the open, with the 3 major contracts running 0.6-0.8% below settlement.

• The NASDAQ 100 leads losses after yesterday’s outperformance (yesterday’s bid was generally fostered by AI-related news and lower Tsy yields, albeit with Tsys finishing off best levels of the day).
• A negative lead out of Europe has helped apply pressure, as has a softer-than-expected round of earnings data from Korean tech giant Samsung.
• Higher European yields haven’t helped bulls (with that move largely supply-related), although Tsy yields are now a touch lower on the day.
• Microsoft is indicated lower (-0.6%) on the back of reports pointing to a potential EU merger investigation re: its ties with OpenAI
• A negative brokerage move from Citi on Netflix (cut to neutral) will not be aiding wider sentiment re: tech. The name is indicated a little lower pre-market (-1.8%).
• Paypal was subjected to a similar move at Morgan Stanley and is also indicated a little lower (-2.2%).
• Elsewhere, brokerage calls, M&A & activist moves surrounding some smaller names has caught the eye, but won’t have been meaningful at the benchmark index level.
• Our technical analyst suggests that the recent move lower in S&P 500 e-minis appears to have been a correction. Support at the 20-day EMA (4,750.67) was pierced. A clear break of this average would strengthen a short-term bearish threat and expose the lower MA envelope band (4,695.69). Below there, bears would eye the 50-day EMA (4,656.58). For bulls, a continuation higher would expose key resistance and the bull trigger at the Dec 28 high (4,841.50).
• Earnings season will become more active later in the week. Click for our preview of the major releases.