Opening Bell - Morning Commentary
US Markets Mixed as Oil Plunge - Tech Rallies While Energy Tumbles
The S&P 500 and *Dow Jones fell on Tuesday as economic concerns pressured cyclical sectors outside technology.
Oil prices plunged, with WTI crude falling to $55.61 and Brent to around $60 per barrel—the lowest since early 2021. Optimism over a potential Russia-Ukraine peace deal, expectations of oversupply, and weak Chinese data pressured energy markets.
The Nasdaq closed higher as Tesla shares jumped 3.1% to record highs near $486 after CEO Elon Musk confirmed the company is testing fully autonomous robotaxis in Austin, potentially removing safety monitors. The stock has more than doubled since March, driven by enthusiasm for autonomous driving and AI.
The volatility followed November's employment report, which showed non-farm payrolls rose 64,000 after falling 105,000 in October, beating the expected 50,000 gain. However, unemployment climbed to 4.6%, a four-year high.
Fed Futures still price in two Federal Reserve rate cuts next year, with labour data leaving expectations unchanged.
Pfizer dropped over 5% after issuing 2026 earnings guidance of $2.80 to $3.00 per share, below the $3.06 consensus, with projected revenues of $59.5 billion to $62.5 billion and $1.5 billion less from COVID-19 products.
Asian markets were mixed on Wednesday as mixed U.S. employment data failed to shift expectations for monetary policy, leaving investors awaiting further direction.
Japan's exports to the U.S. rebounded in November for the first time in eight months, suggesting a easing of tariff effects and supporting the case for continued Bank of Japan rate hikes.
The rupee weakened for a fifth straight session yesterday, depreciating 30 paise to close at a new record low. This weakness is primarily attributable to ongoing Foreign Fund Outflows (FIIs) from capital markets, coupled with persistent global risk aversion.
Nifty extended its decline for the second consecutive session yesterday, registering a sharp loss of 167 points to close at 25860.
A decisive break below the 50-DEMA level at 25760 could trigger additional selling pressure and deepen the ongoing correction. On the upside, the 26058 is likely to act as an immediate resistance level. A sustained move above 26,058 would signal a short-term bullish breakout and open the path for higher levels in the range of 26200-26300.
Indian markets are poised to open near yesterday's close and attempt a recovery from lower levels.