Stocktwits Passport Portfolio: Wall Street Outpaces Asia As AI Trade Wobbles And Bond Yields Climb

• U.S. stock markets were buoyed earlier in the week by softer-than-expected jobs data, which lowered expectations for another benchmark interest rate hike from the Federal Reserve this month.
• The Invesco QQQ Trust, which tracks the Nasdaq-100, is the only U.S. benchmark index poised to end the week in red, amid a pullback in technology stocks. 
• Meanwhile, the iShares MSCI China ETF (MCHI) was the only Asian market to trade higher this week, though it reopened to a tough backdrop after a seven-day close.

Global stock markets faced mounting pressure this week, as rising bond yields and growing concerns around the AI trade weighed on investor sentiment. 

Despite volatility, U.S. markets held up better than Asian counterparts, with the S&P 500 and Dow Jones Industrial Average headed for marginal gains, even as South Korea, Japan, and Taiwan are poised to end the week lower.  

China was the outlier among its Asian counterparts, posting a small gain, although the Mainland’s stock markets reopened only on Oct. 8, after closing for the National Day Golden Week holiday from Oct. 1. 

US Markets Vs Asia Markets

U.S. stock markets were buoyed higher earlier in the week by softer-than-expected jobs data, which lowered expectations for another benchmark interest rate hike by the Federal Reserve this month. The SPDR S&P 500 ETF Trust (SPY) and the SPDR Dow Jones Industrial Average ETF (DIA) are on track to close the week higher. 

According to data from the CME FedWatch tool, the probability of a 25 bps rate hike in October is 17.2%, down from 22.1% a week ago.

However, a pullback in technology and semiconductor stocks dragged U.S. markets. On Thursday, OpenAI reportedly clocked about $50 billion in annualized revenue at the end of September, while markets widely expected $70 billion.  

The Invesco QQQ Trust (QQQ), which tracks the Nasdaq-100, is the only U.S. benchmark index poised to end the week in red. 

Meanwhile, the iShares MSCI China ETF (MCHI) was the only Asian market to trade higher this week, though it reopened to a tough backdrop after a seven-day close. China’s SSE Composite index closed down 0.79% on Thursday amid the tech selloff and rising global bond yields. However, it recovered to trade in the green territory on Friday. 

The iShares MSCI South Korea ETF (EWY) posted the sharpest decline, on track to close more than 8% lower. Shares of Korean-listed Samsung Electronics slumped more than 5% this week, while SK Hynix tumbled nearly 9% at the time of writing as investors questioned whether the AI-driven memory-chip boom could sustain its momentum.

The iShares MSCI Taiwan ETF (EWT) and the iShares MSCI Japan ETF (EWJ) are also trending lower this week, amid global bond-market turbulence, the technology rout, and rising energy prices due to the ongoing war in Iran. 

Retail Stance: US Vs Asia Markets

On Stocktwits, retail sentiment around SPY, QQQ, and DIA was in the green territory. 

Meanwhile, retail sentiment around EWT, MCHI, and EWJ was ‘bullish’ while it was ‘neutral’ for EWY at the time of writing.  

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