Nasdaq 100: SpaceX Lockup Tests AI Trade After Asia Tech Selloff

Dow Holds Record but Nasdaq Sinks on AI Spending Fears

The indexes are split Thursday morning. The Dow is higher after closing at another record, but the Nasdaq-100 is lower after Asian technology shares sold off hard overnight. SpaceX’s lockup expiry hits today with more than 900 million insider shares becoming eligible for sale while the stock is already below its IPO price. South Korea’s Kospi dropped 4.58% led by SK Hynix falling 9.71%. The market is pushing back on AI spending and the pressure is hitting everything connected to it.

Fed Governor Lisa Cook said she is prepared to support a rate hike unless inflation keeps easing. Weekly jobless claims land today. Friday’s payrolls is still the main event.

Dow futures are up 136 points or 0.25% at 08:38 GMT. S&P 500 futures are higher by 0.12%. Nasdaq-100 futures are down 0.38%.

Daily September E-mini Nasdaq-100 Index Futures Technical Analysis

September E-mini Nasdaq-100 Index futures are under pressure early Wednesday after yesterday’s rally to 30074.00 failed to overcome the July 10 main top at 30077.75. The subsequent reaction to that move led to the formation of a potentially bearish closing price reversal top.

Overnight, the tech-based index not only confirmed the closing price reversal top, but it also crossed to the weak side of the 50-day moving average at 29622.19 and the intermediate Fibonacci level at 29610.75. This area is early resistance. As long as the index remains under these levels, it is vulnerable to the downside. If the downside momentum continues to build in the pre-market session, we could see a pullback to the intermediate 50% level at 29150.75.

The new short-term range is 27201.50 to 30074.00. If 29150.75 is taken out with conviction then we could see a plunge into the short-term range retracement zone at 28637.75 to 28298.75.

On the upside, recapturing the 50-day MA will indicate the return of buyers. If the move creates enough upside momentum then look for the rally to possibly trigger a breakout over 30077.75. This will change the trend to up on the swing chart and put the index on a path toward swing tops at 30599.75, 30975.50 and the all-time high at 31100.00.

SpaceX Lockup Puts the AI Spending Trade on Trial

SpaceX is the name to watch Thursday. More than 900 million insider and early-investor shares become eligible for sale and the stock is already in trouble. SpaceX fell 13.6% Wednesday after its first public earnings report showed capital expenditures surged sixfold to $18.4 billion. The company beat on revenue, narrowed losses and raised its long-term forecast. The market did not care once the AI spending bill came into view.

The stock closed above $125 Tuesday, still below the $135 IPO price, and gave up more ground Wednesday. CFO Bret Johnsen said the company can get a payback on its AI infrastructure in less than a year. Thursday is when the market decides if it believes him or if it would rather sell into the new supply.

Technically, SpaceX is trading steady-to-better overnight at $110.87. The short-term range is $126.71 to $104.83. Its retracement zone at $113.19 to $115.77 is now overhead resistance.

A sustained move back over $113.19 will indicate that selling pressure is easing. Overcoming $115.77 will indicate the presence of buyers. Taking out $126.71 will change the minor trend to up and shift momentum to the upside. This could trigger a follow-through move into the $135.00 to $150.00 area.

A sustained move under $113.19 keeps sellers in control and could lead to a retest of Monday’s all-time low at $104.83. Under this level is the psychological $100.00 level. Taking out $100.00 with conviction could trigger an acceleration to the downside, but counter-trend buyers may attempt to defend that area.

Asia Sold the Same Story Overnight

The Kospi lost 4.58%. SK Hynix dropped 9.71%. Samsung fell 6.13%. In Japan, SoftBank lost 4.36%, Tokyo Electron dropped more than 5% and Kioxia fell 8.84%. Those are not minor pullbacks. The same concern that crushed SpaceX on Wednesday went straight through Asia overnight: the AI infrastructure spending is getting large enough that buyers want proof of returns before they keep funding it.

J.P. Morgan said it does not see hyperscalers cutting spend over the next six to 12 months. S&P Global reported that July technology equipment output rose at its fastest pace since May 2021. The demand story has not broken. The willingness to pay for it at these valuations is what changed. Europe opened steadier but semiconductor and memory names are still weak.

Industrials Keep the Dow at Records

The Dow’s fifth straight higher close tells you the rally is not entirely a technology story. Industrials have been catching the bid while oil cools and earnings stay firm. Lower crude takes inflation pressure off the rate trade and gives the parts of the market that had been stuck all summer room to work.

But the Dow cannot carry the indexes alone. If the Nasdaq keeps falling while the industrial average climbs, that is rotation, not a broadening rally. The S&P 500 lost 0.17% Wednesday. The Nasdaq Composite fell 0.83%. The split is already showing.

Stocks in the News

Warner Bros. Discovery reports before the bell Thursday. Airbnb and Lyft report after the close. The market has been punishing companies that miss on revenue, margins or guidance this earnings season. None of these names will set the direction for the major indexes but weak results from any of them add to the defensive tone.

What to Watch

SpaceX’s lockup is the event that sets the tone Thursday. If the stock absorbs the new supply without another hard break, the AI spending trade stabilizes and the Nasdaq has a chance to recover. If insiders sell into a stock already below its IPO price, the pressure spreads to every name connected to AI infrastructure costs and Asia’s overnight damage gets worse.

The Dow has records and industrial earnings behind it. The Nasdaq has a confirmed closing price reversal top and is already back below its 50-day moving average. Friday’s payrolls decides whether the rate trade reassembles or the relief continues, but today is about whether the AI spending story can absorb a flood of new shares and a global tech selloff at the same time. Cook’s willingness to hike adds another layer of risk if the labor data cooperates.

More Information in our Economic Calendar.