[MARKET ANALYSIS] Global equities under pressure as the Iran war persists, Tech falters following Google update

European bourses (STOXX 600 -1.0%) have gotten off to a softer start to Thursday's session. The DAX 40 underperforms, hindered by poor Porsche SE earnings, while the SMI outperforms with only mild losses, as Kuehne+Nagel, along with the broader shipping sector, is supported by Hapag-Lloyd earnings. Despite expecting a major hit to earnings due to disrupted trade flows and higher costs, the idea that Hapag is only seeing disruptions now may be supporting shares.
Sectors are entirely in the red, with Basic Resources, yet again, sitting at the bottom of the pile as metals prices continue to fall. Technology also prints decent losses, following news stateside by Google that its new TurboQuant tech can reduce the amount of memory needed for AI workloads, which is weighing on computer memory and storage makers (ASML -3.8%).
Next and H&M, two retailing giants, reported earnings this morning. Next posted FY revenue that grew around 10% annually and slightly raised its pre-tax profit guidance by GBP 8mln. The Co. has also already accounted for around GBP 15mln of additional costs to arise from the conflict. H&M's Q1 sales fell short of expectations, as weak consumption and currency effects continue to hurt performance.
Other key movers include Boliden, STMicroelectronics and BMPS. Boliden announced that its Q1 earnings will take a SEK 400mln hit due to the seismic activity at the Garpenberg mine. The Co. further guides that production at the mine will resume at 30% capacity until further notice. For the Italian bank, the Board has reappointed Luigi Lovaglio as CEO after he challenged the bank’s plan to replace him when his term ends in April. Finally, STMicroelectronics was upgraded to overweight from equal weight at Morgan Stanley.
US equity futures are under pressure, following their European peers. ES remains below the 200-SMA and is struggling to return above the key range lows of 6635, a worrying sign of market sentiment. The 20-, 200-SMA bearish cross has also been confirmed. However, there are metrics that point to a short-term bounce: 1) recent significant de-grossing, 2) fear index showing 'extreme fear', and 3) the increased probability of a significant low being printed in late March/early April based on historical data.