Tech Stocks Are Set To Rebound
S&P 500 futures are gaining ground in premarket trading as tech stocks look ready to rebound after a major sell-off.
The biggest loser of the recent days, Tesla, is up more than 6% in premarket action. Apple, Amazon, Microsoft, Facebook are also set for a solid start of the day.
The trading dynamics of tech stocks have a very big impact on general market mood so their rebound is a necessary catalyst to stop the current market sell-off.
While the recent sell-off was significant, it did not have any clear catalyst and was mostly caused by profit-taking after a major rally. In case tech stocks manage to rebound and do not fall below their recent lows, S&P 500 will resume its previous upside trend.
AstraZeneca Has Put Its Vaccine Trials On Pause
One of the participants of AstraZeneca‘s study had an unexplained illness, prompting the company to stop the trial.
While such situations are not rare in large-scale trials and the fate of the vaccine depends on the upcoming investigation, traders’ reaction was rather nervous, and AstraZeneca shares are losing ground in premarket trading.
However, the news did not have any material impact on the general market mood. In addition to the fact that such situations sometimes happen in large-scale trials, there are many potential vaccines in the pipeline so the market’s consensus is that the world will have a working vaccine against COVID-19 within a reasonable timeframe.
Oil Rebounds Above $37
WTI oil managed to find support near $36 and rebounded above $37 as speculative traders increased their long bets on oil after the major sell-off.
In just five trading sessions, oil declined from $43 to $36 on concerns about the speed of oil demand recovery.
Oil price recovery is a welcome development for oil-related equities which had a very challenging start of the month.
It remains to be seen whether oil price recovery will continue as the U.S. dollar is trying to gain more ground against a broad basket of currencies and may put additional pressure on commodities.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire