The Nasdaq 100 futures suffered a drop as crude oil prices dropped 30% this morning along with the Chinese Trade Balance figures. The global markets were spooked by China’s steep decline in imports and exports as the coronavirus continues to wreak havoc on trade and factory activity in China. This is having a spill over effect as many companies listed on the Nasdaq 100 are exposed to China, depending on the supply chains of products which run through that country.
Exports fell by 17.2% from 2019 figures to a little over $292.4 (against a rise of 7.8% in December 2019) while imports dropped by 4% to $299.5 billion, down from December’s 16.2% gain. Enforced quarantines and controls by the Chinese government to stop the spread of the coronavirus have shuttered production and restricted imports of raw materials and export of finished goods from the world’s production hub.
The numbers do not look set to recover soon as the coronavirus outbreak continues.
The Nasdaq 100 index is trading more than 5% lower as stocks of Tesla, Advanced Micro Devices and Western Digital drag the index down as today’s biggest losers so far. The Nasdaq 100 is now approaching the 8015.5 support level, with 7834.6 lying closely underneath. A break of 8105.5 targets 7834.6 in the first instance, with 7508.9 being the next support in line if the downside continues.
On the flip side, the 8160.2 is the immediate resistance target if price bounces on 8105.5, with 8442.5 being the next in line if the bounce is able to breach 8160.2. 8691.0 also has the potential to be relevant in the scheme of things if a recovery push comes up.