Market Wrap

Morning wrap: US stocks stage late selloff, ASX to open lower

Fri 31 Dec 21, 9:00am (AEST)

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ASX Futures (SPI 200) imply the ASX will open 7 points lower, down -0.1%.

All three major US indexes were trading in positive territory up until the last hour of trade, before closing modestly lower. It looks like investors are happy to take profits in what is the second last trading session of 2021.

Overnight summary

Fri 31 Dec 21, 9:00am (AEST)

Name Value Chg %
US Indices
S&P 500
4778.73 -0.30%
Dow Jones
36,398 -0.25%
NASDAQ 100
15,742 -0.16%
Russell 2000
2,249 -0.02%
Country Indices
Canada
0 0.00%
China
0 0.00%
Germany
15,885 +0.21%
Hong Kong
23,112 +0.11%
India
0 0.00%
Japan
28,792 -0.40%
United Kingdom
0 0.00%
Name Value Chg %
Commodities (USD)
Gold
1,817.00 +0.16%
Iron Ore
120.20 -
Copper
4.391 -0.03%
WTI Oil
76.33 -0.86%
Currency
AUD/USD
0.7249 +0.08%
Cryptocurrency
Bitcoin
0 0.00%
Ethereum
0 0.00%
Miscellaneous
U.S. 10 Year Treasury
1.515 -1.81%
VIX
17 +2.24%

The Dow Jones and S&P 500 were both on track for another record close up until the last hour of trade. 

Some last-minute selling across technology, energy and defensive stocks has taken some heat out of the Christmas rally.

The last five trading days of the year and the first two sessions in January is historically a strong period for stocks, dubbed the “Santa Claus rally”. 

On the economic front, the US Labor Department reported that 198,000 applied for unemployment benefits in the week ended 25 December. This marks a 52-week low for new jobless claims despite the rapid spread of omicron. 

Along with jobless claims, there is some encouraging news regarding omicron. The number of Americans in hospital with covid is sitting around 60,000 or half the figure seen in January, according to the Centers for Disease Control and Prevention. This is despite the US logging almost half a million cases.


US Sectors

Friday, 31 December 2021

Sector Chg %
Communication Services 0.00
Consumer Discretionary 0.00
Consumer Staples 0.00
Energy 0.00
Financials 0.00
Health Care 0.00
Sector Chg %
Industrials 0.00
Information Technology 0.00
Materials 0.00
Real Estate 0.00
Utilities 0.00

Tech stocks sold off just before close, dragging the Nasdaq into negative territory. Mega caps struggled to finish in positive territory, with names like Apple, Alphabet and Microsoft down less than -1%. 

Semiconductor stocks struggled, with AMD down -2.1% and Nvidia closing -1.4% lower. 

Energy stocks fell as the global spike in covid cases weighed on sentiment. Crude oil closed slightly lower, snapping its six-day winning streak. 

Material stocks as a whole declined, but the US-listed counterparts of BHP Group (ASX: BHP) and Rio Tinto (ASX: RIO) rose 0.1% and 1.0% respectively.


Industry ETFs

Friday, 31 December 2021

Description Last Chg %
Commodities
Aluminum 58.65 +0.09%
Copper Miners 36.69 -0.12%
Gold 168.59 +0.72%
Lithium & Battery Tech 84.31 +0.72%
Nickel 26.98 +0.56%
Strategic Metals 110.66 +1.10%
Steel 52.73 +0.40%
Silver 21.11 +1.09%
Uranium 22.83 -1.63%
Industrials
Aerospace & Defense 102.82 -0.10%
Global Jets 21.14 -0.05%
Healthcare
Biotechnology 152.83 +0.61%
Cannabis 5.84 +0.39%
Description Last Chg %
Cryptocurrency
Bitcoin 29.89 -0.27%
Renewables
CleanTech 17.4 +2.09%
Hydrogen 20.02 +2.66%
Solar 75.46 +2.94%
Technology
Cloud Computing 26.55 +1.01%
Cybersecurity 32.04 +0.19%
E-commerce 27.03 +2.28%
Electric Vehicles 0 0.00%
FinTech 39.84 +1.54%
Robotics & AI 35.99 +0.31%
Semiconductor 550.19 -1.13%
Sports Betting/Gaming 24.59 +1.42%
Video Games/eSports 65.7 +1.63%

ASX Sectors in play

ETF GAINERS

The Hydrogen ETF rebounded after a sharp decline yesterday, driven by a sharp -12.9% selloff from one of its major holdings, Fuel Cell Energy. 

  • The weak session yesterday triggered further losses for ASX hydrogen stocks on Thursday. Hazer Group (ASX: HZR) closed -1.7% lower while Lion Energy (ASX: LIO) was down -2.9%. 

  • The rebound could see some positive flow come back to local hydrogen names 

The Sports Betting & iGaming ETF could be a chart of interest, working its way through a double bottom and testing a 1-month high. A similar chart set up to the likes of BHP and Fortescue Metals Group (ASX: FMG).

Major US sports betting stocks like DraftKings and Penn National Gaming have declined more than -30% year-to-date amid a broad-based selloff for richly-valued technology stocks.

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Investors could keep an eye out for ASX names like PointsBet (ASX: PBH), BetMakers Technology Group (ASX: BET) and Bluebet (ASX: BBT) and whether or not they follow through with the ETFs recent rebound.

ETF LOSERS

The Uranium ETF went ex-dividend for US$1.3 a share. This was responsible for roughly 80% of last night’s -US$1.57 decline. That said, the ETF is now trading at a 4-month low, closing just below its 200-day moving average. 

Similarly, the FinTech ETF also went ex-dividend for US$2.16 a share, driving most of its losses overnight. 


Upcoming events

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Written By

Kerry Sun

Finance Writer & Social Media

Kerry holds a Bachelor of Commerce from Monash University and was Vice President of the University Network for Investing and Trading (UNIT). He is an avid swing trader, and drawn to breakouts and technical set ups. Outside of writing and trading, Kerry is a huge UFC fan, loves poker and bouldering.

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