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Monday, August 15, 2022

Stock Market Narrowly Mixed As China, Bitcoin Woes Weigh; Nike Tumbles

The stock market pared losses Friday morning and indexes were mixed as a new sell-off in Chinese stocks rippled across global markets.


The Nasdaq composite fell 0.7% at the open but reduced its loss to 0.4%. The S&P 500 erased losses and was flat. Both indexes held above their 50-day moving averages, a positive sign.

The Dow Jones Industrial Average rose 0.1% as Salesforce.com (CRM) added more than 2%. It is in buy range from Thursday’s breakout at 275.32 to 289.09. McDonald’s (MCD) is trying to break out of a base on base with a 247.15 buy point.

Small caps lagged as the Russell 2000 fell 0.5%.

Volume was higher on the Nasdaq and lower on the NYSE compared with the same time on Thursday. Declining stocks outnumbered advancers by a 7-4 ratio on the Nasdaq and by 11 to 10 on the NYSE.

China Bans Bitcoin

New shockwaves emerged from China, where authorities banned all cryptocurrency transactions while China Evergrande Group teetered on collapse.

The Hang Seng in Hong Kong fell 1.3%, the Shanghai composite lost 0.8%, but the Nikkei in Tokyo rose 2.1%.

U.S. Stock Market Today Overview

Index Symbol Price Gain/Loss % Change
Dow Jones (0DJIA) 34799.32 +34.50 +0.10
S&P 500 (0S&P5) 4451.35 +2.37 +0.05
Nasdaq (0NDQC ) 14997.70 -54.54 -0.36
Russell 2000 (IWM) 223.83 -0.98 -0.44
IBD 50 (FFTY) 51.56 -0.78 -1.49
Last Update: 10:28 AM ET 9/24/2021

IShares China Big Cap ETF (FXI) was off 2.1%. Emerging market ETFs fell roughly 1%.

China’s central bank banned Bitcoin and all other cryptocurrency transactions. Officials said the move was made to further limit the risks of crypto trading and for security and social stability purposes.

Bitcoin tumbled 5.5% to $41,600, according to Coindesk. Grayscale Bitcoin Trust (GBTC), a fund that tracks Bitcoin prices, fell nearly 6%. GlobalX Blockchain ETF (BKCH) lost nearly 5%.

Meanwhile, Evergrande Group appeared to miss a $83.5 million bond payment, keeping the real estate company’s creditors on edge. The debt-burdened company faces default and Chinese officials are not expected to step in with a bailout. Investors worldwide fear a collapse could hit global markets, although reports say Beijing is taking steps to contain the damage.

Europe Stock Markets Lower

The London FTSE 100 fell 0.2% and the German DAX lost 0.7%, the Paris CAC 40 fell 0.9%.

Innovator IBD 50 ETF (FFTY) plunged 1.6%. Deckers Outdoor (DECK) slid 6%, landing at the lows of a current pattern. The stock is more than 7% below 444.58 buy point, a sell signal for any investors who bought at that brief breakout.

Most footwear stocks fell in sympathy with Nike (NKE), which gapped down more than 6% in heavy volume. Nike missed quarterly sales expectations and cut its forecast for the current quarter and the full year because of supply-chain problems.

Nike is on track for its worst day since June 26, 2020, when it fell 7.6%, according to Dow Jones Market Data. The athletic apparel and equipment maker is the worst performing stock on the Dow and the S&P 500 today.

Cloudflare (NET) fell more than 4%, but the stock remained in an uptrend. The stock found support at its 10-week line last week.

While most IBD 50 stocks were lower, there were no sell signals on the index, other than Deckers.

Juan Carlos Arancibia is the Markets Editor of IBD and oversees our market coverage. Follow him at @IBD_jarancibia


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