ASX 200 to decline as Wall St sees major sell-off

July 24, 2024 03:40 PM PDT | By Investing

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ASX 200 to decline as Wall St sees major sell-off

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Investing.com - Australian stocks are expected to dip at Thursday's open, following significant losses on Wall Street overnight. Investors were spooked by disappointing quarterly earnings from Tesla Inc (NASDAQ:TSLA) and Alphabet (NASDAQ:GOOGL) Inc (NASDAQ:GOOG), the first of the major "magnificent seven" tech companies to report their results.

Futures for the ASX 200 Futures fell by 1%, following a 2.3% drop in the S&P 500, marking its worst day since December 2022. The tech-heavy NASDAQ Composite experienced an even sharper decline of 3.6%, its worst session since October 2022, while the Dow Jones Industrial Average fell by 1.3%.

The Australian dollar slipped below US66¢, while copper led declines among base metal prices.

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The CBOE Volatility Index (VIX) surged by 22.6%, and CNN’s Fear & Greed Index dropped into fear territory with a reading of 42, compared to 55 in the previous session and 82 in extreme greed a year ago.

Markets sold off, weighed down by disappointing earnings, particularly among tech companies that have invested heavily in AI but have yet to see significant returns. Tesla's stock plummeted by 12.3% after its founder, Elon Musk, discouraged investors who had lost confidence in the company during a conference call.

The rest of the tech behemoths also suffered: NVIDIA Corporation (NASDAQ:NVDA) lost 6.8%, Meta Platforms Inc (NASDAQ:META) declined by 5.6%, and Alphabet decreased by 5%. Microsoft Corporation (NASDAQ:MSFT), Amazon.com Inc (NASDAQ:AMZN), and Apple Inc (NASDAQ:AAPL) each saw a roughly 3% drop in their stock prices. Some analysts believe that certain "big-tech" firms were considered to be "priced for perfection" going into this earnings season.

Additionally, Visa Inc (NYSE:V) shares fell by 4% after the financial services giant reported revenues that fell short of market expectations, raising concerns about consumer spending.

On the bond markets, Australia 10-year and 2-year rates were at 4.372% and 4.182%, respectively.

This article first appeared in Investing.com

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