The Nasdaq was heading for a lower open on Wednesday after the U.S. Presidential debate failed to bring clarity to the race. The first head-to-head between President Trump and Joe Biden was a hostile affair, which failed to bring anything new to the table. Prediction markets have Joe Biden ahead in the race and investors may be worried about his threat to raise taxes, alongside his plans for large green spending.
A large part of the stock rally was based on Trump’s policies after he pushed through tax cuts and efforts to stimulate the repatriation of offshore savings and investment.
This afternoon sees ADP employment data and final GDP for the second quarter. The growth figures will likely come in close to expectations, but the jobs number will give traders an idea of how Friday’s Non-Farm Payrolls could turn out. The ADP release is expected to show a gain of 650k jobs and President Trump will be hoping for a big payroll number in the last significant employment release before the election.
Billionaire investor Leon Cooperman sounded a warning over the FAANG stocks. Cooperman said there were currently three different stock markets, with the FAANG’s, the Robinhood investor stocks, and the general market. The investor said he holds a large position in Alphabet and Microsoft but stays away from Tesla because of Elon Musk’s tweeting and the current valuation. Cooperman said that the big tech names were not overvalued compared to interest rates, but warned that these types of runs have a high failure rate.
Nasdaq Technical Outlook
The Nasdaq was trading in the middle of an important range after the Monday rally and the index will need to see a close above the 11,550 level in order to see further gains. A close back near 11,000 would be a signal for further losses. The Investing Cube team is currently available to assist all levels of traders with a Forex Trading Course or one-to-one coaching.
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Nasdaq Daily Chart
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