- Wall Street indices open mixed
- US100 trades above 20,000 pts after contract rollover
- Dell, Super Micro Computer and Nvidia trade higher on xAI news
- Accenture rallies after fiscal-Q3 earnings
Wall Street indices launched today's trading mixed, with tech sector gaining. S&P 500 opened 0.2% higher, Nasdaq gained 0.3% at session launch, Dow Jones opened 0.1% lower and small-cap Russell 2000 was down 0.3% at session launch.
US housing market data for May released at 1:30 pm BST turned out to be a huge disappointment. Report showed an unexpected 5.5% MoM plunge in housing starts to 1277k (exp. 1370k) as well as an unexpected 3.8% MoM drop in building permits to 1386k (exp. 1450k). US index futures as well as US dollar took a hit on the release. However, losses on USD market were quickly recovered.
Source: xStation5
Contract rollover took place on US index futures today, resulting in over-1% bullish price gaps on US500, US30, US100 and US2000. As a result, US100 is trading above an important psychological level for the first time in history - 20,000 pts mark. Taking a look at US100 chart at weekly interval (W1), we can see that 14-period RSI indicator is flashing a potential warning signal. The indicator jumped above 70.0 mark this week, a level often associated with local highs. However, it should be noted that, after climbing above this hurdle, the index tended to remain there for a few months before the downward correction actually began. This means that correction is neither certain nor immediate, but traders should keep in mind risk of one occurring given current stretched valuations.
Company News
Accenture (ACN.US) trades higher after reporting fiscal-Q3 results. Revenue declined 0.6% YoY to $16.47 billion (exp. $16.56 billion), with drop being led by 7.8% YoY decline in Financial Services. Bookings climbed 23% YoY to $21.1 billion (exp. $17.69 billion), with Managed Services new bookings jumping 42% YoY to $11.8 billion (exp. $8.81 billion). Gross margin remained unchanged compared to a year ago at 33.4% (exp. 33.4%), while operating margin improved from 14.2% to 16.0%. Adjusted EPS of $3.13 was slightly lower than $3.14 expected and $3.19 reported a year ago. Company expects full-year revenue growth of 1.5-2.5%, narrower than previous forecast of 1.0-3.0%, and adjusted EPS of $11.85-12.00, slightly lower than $11.97-12.20 in previous forecast.
Dell Technologies (DELL.US) and Super Micro Computer (SMCI.US) are trading higher today after Elon Musk said in a post on X platform that the two companies will provide server racks for his artificial intelligence startup xAI.
Nvidia (NVDA.US) launched today's trading higher, extending its lead over Microsoft and Apple as the world's largest company in terms of market capitalization. Today's gains are supported by comments by Michael Dell, CEO of Dell Technologies, who said that his company is building an AI factory together with Nvidia to power xAI's supercomputer.
Accenture (ACN.US) launched today's trading with an almost-10% bullish price gap, after company reported a much better-than-expected bookings for fiscal-Q3. The next resistance zone to watch can be found in the $320.00 area, marked with 38.2% retracement of recent drop. Source: xStation5
