Global Markets Mixed After Tech Selloff; Bitcoin Hits 16-Month Low

By Dow Jones Newswires Staff

U.S. Futures and global markets were mixed after a selloff in technology stocks on valuation concerns and rising artificial intelligence-related costs. Software stocks continued to fall in all regions, sending MSCI's Asian technology index to a sixth straight decline, while the Nasdaq composite fell for the second day on a row, marking its largest two-day drop since October.

However, Europe's tech-heavy AEX index opened up slightly higher with rises from BE Semiconductor, ASML and ASM.

U.S. Treasury yields edged lower, while the dollar rose slightly after President Trump hailed positive talks with Chinese counterpart Xi Jinping Wednesday.

The higher dollar led to falls in Silver and gold prices, continuing a rocky week since Trump's appointment of Kevin Warsh as Federal Reserve Chair on Friday.

Bitcoin fell to its lowest since November 2024 in Asian trade and continues to trade close to that level after declines in U.S. tech stocks intensified overnight.

--U.S. Futures for the S&P 500 and tech-heavy Nasdaq composite index were up, while the Dow Jones Industrial Average was down, following a mixed session on Wednesday which saw Nasdaq record consecutive 1% declines for the first time since April's tariff chaos. Futures for the S&P 500 were up 0.13% while the Nasdaq index was 0.3% higher after closing 0.5% and 1.5% lower, respectively, in the prior session. Futures for the Dow Jones Industrial Average were down 0.05% after rising 0.5% on Wednesday. Chip maker Advanced Micro Devices fell 17% after disappointing earnings, Palantir shares dropped 12% and data-storage company SanDisk lost 16%.

--Asian markets were broadly lower, with equities indexes weighed by chip and technology stocks. South Korea's Kospi ended 3.9% lower, as chip and defense stocks fell, continuing the extreme volatility seen over the past sessions that has forced authorities to halt trading. Japan's Nikkei Stock Average closed 0.9% lower, dragged by chip & tech stocks. China's Shanghai Composite finished 0.6% lower. The tech selloff in China/HK seems to have paused, with Hong Kong's Hang Seng edging up, and the HS Tech Index 0.6% higher.

--European indexes opened mixed on Thursday with the Stoxx 600 and London's FTSE 100 both down after hitting new record highs in the prior session. The technology sector is leading the Stoxx index, while utilities, energy and mining sectors weigh. Germany's DAX, France's CAC 40 and Italy's FTSE MIB are up 0.09%, 0.5% and 0.2%, respectively, while the tech-heavy AEX was up 0.5%, boosted by BE Semiconductor, ASML, RELX and ASM. FTSE 100 index is down 0.2% and Stoxx down 0.07%. Rate decisions from the Bank of England and ECB later will be closely watched although both are expected to hold rates steady.

--The dollar rose slightly after President Trump hailed positive talks with his Chinese counterpart Xi Jinping Wednesday. Trump said his call with Xi was "all very positive" where they discussed Taiwan, the Russia-Ukraine war, China's purchase of oil and gas from the U.S. and China considering buying more U.S. farmed soybeans. Meanwhile, U.S.-Iran talks are scheduled for Friday in Oman after reports Arab states made efforts to convince the U.S. not to walk away from negotiations. The DXY dollar index rose 0.1% to 97.735.

--U.S. Treasury yields edged lower across the curve in Asian trade with expectations around nominated Federal Reserve Chair Kevin Warsh keeping markets busy. "Trump's nomination of Kevin Warsh strengthens expectations that the Fed may be less inclined to use its balance sheet as heavily going forward as it did in the past," Commerzbank's Erik Liem said in a note. Treasury's decision to keep auction volumes steady while continuing to evaluate potential future increases to note, bond and floating rate note auction sizes was in line with expectations. The two-year Treasury yield edged lower by 0.6 basis points to 3.551%, the 10-year yield fell 1 basis point to 4.267% and the 30-year yield declined 0.6 basis points to 4.909%, according to Tradeweb.

--Eurozone government bond yields edged higher in opening trade after an unexpected jump in German manufacturing orders in December and ahead of significant Spanish and French bond issuance. The key focus Thursday is the European Central Bank's announcement, with interest rates widely expected to be kept on hold. This will keep the eurozone's deposit rate at 2.0% as data show the economy holding up relatively well. The 10-year German Bund yield was up 0.5 basis points at 2.867%, the 10-year Spanish yield was up 1.1 basis points at 3.242% and the 10-year French yield rose 1 basis point to 3.458%, according to LSEG.

--Yields on U.K. government bonds, or gilts, rose amid rising political unease within the U.K.'s ruling Labour Party due to displeasure about Keir Starmer's leadership. Investors are concerned about a possible leadership change that could result in looser fiscal policies and increased government borrowing. Markets also await the Bank of England's interest-rate decision at 1200 GMT when interest rates are widely expected to remain unchanged at 3.75%. Ten-year gilt yields climbed to a 2.5-month high of 4.578% in opening trade, Tradeweb data show. They are last at 4.559%, up 2.1 basis points on the day.

-- Bitcoin fell to its lowest since November 2024 in Asian trade and continues to trade close to that level after declines in U.S. tech stocks intensified overnight. Software and tech stocks along with cryptocurrencies and precious metals are all owned heavily and investors are adjusting their positions, Jefferies economist Mohit Kumar says in a note. Concerns are being raised about crypto miners and whether there could be forced liquidations if prices continue to fall, he says. "Our view on crypto has always been that it should be never [make up] more than a very small portion of the overall portfolio." Bitcoin falls 2.9% to $70,528 after reaching a low of $70,052 earlier, LSEG data show.

--Oil prices fell after the U.S. and Iran agreed to hold talks in Oman on Friday. Brent crude was down 1.6% to $68.35 a barrel, while WTI slid 1.7% to $62.90 a barrel after settling more than 3% higher in the previous session, when the talks seemed in danger of collapsing. Uncertainty surrounding the negotiations is expected to keep a risk premium priced into the market, driven by fears of possible U.S. strikes on Tehran and a wider confrontation in the oil-rich region, analysts say. Separately, the latest EIA data showed crude stockpiles fell by 3.5 million barrels last week as a decline in production due to winter storm Fern partially offset a rise in imports.

--Gold prices edged lower in early trading, holding below the $5,000 mark in the absence of fresh catalyst and amid a stronger dollar. Futures in New York fell 0.1% to $4,944 a troy ounce, while the U.S. dollar index --which measures the greenback against a basket of major currencies--was up 0.1% at 97.71. "A stronger USD weighed on investor appetite," ANZ analysts said. "This offset any gains coming from rising haven buying as geopolitical tensions rise in the Middle East." Any sustained upside is likely to depend on continued buying from China, where physical demand has been strong ahead of the Lunar New Year, according to the analysts.

--Silver prices fell sharply after a short-lived rebound as high volatility persists following a historical selloff. In early trading, New York futures plunged 5.8% to $79.53 a troy ounce. "Heavy selling emerged in the Chinese futures market and on the CME after failing to break resistance at $90.50," analysts at Saxo Bank said. Meanwhile, the Shanghai spot premium over London fell to a three-week low, signaling local demand in China is weakening relative to international prices. "Until market plumbing improves-through lower volatility and better liquidity-silver is likely to continue trading violently in both directions," the analysts said.

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Corrections & Amplifications

This article was corrected ata 05:11 a.m. ET to clarify that the HS Tech Index was 0.6% higher, not 06% higher.

(END) Dow Jones Newswires

02-05-26 0457ET