Pre Open US - US Indices 20 July 2023

On Thursday, both the S&P 500 and Nasdaq futures experienced declines. Netflix Inc. faced its most significant intraday drop since December due to missed sales estimates and a third-quarter revenue projection that fell short of Wall Street's expectations. Similarly, Tesla Inc. also saw a decrease in profitability during the second quarter, indicating a squeeze on the electric-vehicle maker's margins.

The remarkable rally in the tech-heavy Nasdaq, which surged 45% this year, surpassing the S&P 500's 19% increase, seems to have hit a pause. This rally was fueled by enthusiasm over the potential for artificial intelligence.

IBM (IBM.N), a provider of enterprise software, experienced a 0.6% slip after its second-quarter revenue failed to meet Wall Street's expectations. The decline was mainly driven by reduced sales of its mainframe computers as businesses cut back on tech spending.

The U.S.-listed shares of Taiwanese chipmaker TSMC also dropped by -2.2% after warning of a projected 10% sales decrease in 2023.

According to Refinitiv data from Wednesday, overall earnings across various industries are expected to decline by 8.2% for the second quarter.

There are concerns about a potential U.S. recession this year, primarily due to central banks tightening policy and constricting economies until inflation returns to their 2% targets.

The Nasdaq is rebounding from the target of 15,800 and consistently testing the upper boundary of the current bullish channel on a daily basis. The price action of the Nasdaq on the 4-hour chart suggests a potential correction towards the support level at 15,250.