SINGAPORE (Reuters) – Chip stocks dragged Asian indexes lower and European futures fell on Wednesday as growth concerns sparked the biggest sell-off in a month on Wall Street and investors wiped out $279 billion in value from market darling chipmaker Nvidia.
Oil hit a low in Asian trading, the safe-haven yen rose, Japanese shares fell more than 3% and regional shares excluding Japan fell almost 2%. [MKTS/GLOB]
Here are analysts’ and investors’ comments on market movements:
NICK FERRES, CIO, VANTAGE POINT ASSET MANAGEMENT, SINGAPORE
‘The ISM production index threw cold water on the favorable growth prospects.
“While equities have responded enthusiastically to the subdued interest rate outlook… a range of key leading indicators suggest that macro conditions are likely to deteriorate more sharply going forward. In that context, the S&P 500’s valuation multiple, equity and credit premiums do not provide sufficient compensation.” for risk.
“We fear a new phase of decline in the coming weeks.”
JUN BEI LIU, PORTFOLIO MANAGER, TRIBECA, SYDNEY
‘People take away a little profit.
‘There is nothing fundamentally wrong with the stock market. In any case, things are actually looking pretty good. You have to start with 25 basis point cuts and there will be several more, and the economy will slow down, but not collapse.
“The next few months are likely to see the trough of earnings, and for investors, the next few months are when you can capture a lot of those opportunities.”
STEVEN LEUNG, EXECUTIVE DIRECTOR, INSTITUTIONAL SALES, UOB KAY HIAN, HONG KONG
“Hong Kong is quite weak, so if we see such a negative signal from the US, Hong Kong will perform even worse.
“People think that the current situation is different from the one in August, due to the unwinding of the carry trade in the yen. This time that is not the reason, but more because of the US economy. It is more frightening, because it is not technical reason, it is a more fundamental issue.”
JASON TEH, CIO, VERTIUM ASSET MANAGEMENT, SYDNEY
“The question is how quickly the economy slows while the Fed cuts rates, because if they lag the curve, markets will continue to sell off.” It’s that tightrope right now and the market is trying to figure that out.
“If you look at Nvidia as a market leader, it’s not holding up despite very strong profits. There’s an old saying: If the troops can’t follow the generals, that’s a warning sign… if the Nvidias, Apples and Microsofts can’t do it keep the market up, that’s it, we’re in a bear market.”
MICHAEL ARONE, SPDR CHIEF STRATEGIST, STATE STREET GLOBAL ADVISORS, BOSTON
“What I expect is that we will see a continued rotation away from technology stocks, which will pave the way to broader leadership. That’s happening because both interest rates and inflation are falling, which should help close the gap in earnings growth between the tech sector and the economy. the rest of the market.”
SAM STOVALL, CHIEF INVESTMENT STRATEGIST, CFRA, NEW YORK
“I think investors have simply succumbed to seasonality ahead of what they fear will be a double dose of election-year declines in both September and October, and have latched onto the big-gain stocks.” .
“This may be a short week, but it will be an important and crucial week for investor confidence; people will remain on edge.”
STEVE SOSNICK, MARKET STRATEGIST, INTERACTIVE BROKERS, GREENWICH, CT
“There is a bit of a post-Nvidia earnings hangover today. Last week’s earnings were fine; they exceeded expectations. But the size of the earnings numbers are decreasing quarter after quarter and that is not lost on investors.
“There are concerns about what the jobs numbers will show, about seasonality. That’s why the VIX is higher. I don’t think the ISM figure, which shows a weaker manufacturing sector but higher prices, was helpful at all. It. Gravity.”
MICHAEL GREEN, PORTFOLIO MANAGER, SIMPLIFY, SAN FRANCISCO BAY AREA
“People are overcommitted to Nvidia and a lot of these names and they’re trying to reduce that exposure. It just has the potential for these things to sell significantly.”
(Reporting by Reuters bureaus in New York and Asia; Compiling by Tom Westbrook; Editing by Sonali Paul)