Selling has enveloped the US stock market again on Wednesday after United States (US) President Donald Trump said the ceasefire with Iran was over following renewed hostilities between the nations. The US said it responded to Iran’s attack on an Oil tanker in the Strait of Hormuz earlier in the week by firing on 80 Iranian military assets. Iran responded with waves of attacks against US military installations in Bahrain and Kuwait.
After the US launched its initial assault overnight, President Trump said the ceasefire between the US and Iran that began in early April had ended. Reports surfaced that the US had moved 5,000 military planes to the region. Oil (WTI) jumped over 4% on the news. Observers expect that the hostilities might ramp up over the next several days.
NASDAQ 100 futures sold off more than 1% in the premarket on Wednesday, while S&P 500 and Dow Jones Industrial Average futures also sank more than half a percentage point. The market was kept aloft, however, by Trump’s statements that US negotiators will continue talking with their Iranian counterparts.
The NASDAQ 100 is now trading below its 50-day Simple Moving Average (SMA) on the daily chart, a sign that the sell-off has legs.
US tech stocks are feeling the brunt of the sell-off, which also stems from ongoing weakness in South Korea’s KOSPI index. That index fell more than 5% overnight as SK Hynix and Samsung Electronics continue to be battered by sellers following the latter’s earnings release earlier this week. Samsung Electronics reported operating income rising 18X YoY, but the shares sold off anyway as traders booked steep profits.
The KOSPI’s daily chart shows the index breaking through technical support at 7,400 on Wednesday. Since those Korean semiconductor firms mainly trade on the strength of their memory chip businesses, US-based Sandisk (SNDK) and Micron (MU) shed weight in the premarket.
About The Author
