Asia open: Dip buyers spark tech rebound on weak market breadth

• Technology stocks staged a strong rebound, led by semiconductor shares such as Intel and Micron, helping the Nasdaq 100 recover 1.6% despite weak overall market breadth and continued pressure on non-tech sectors.
• Middle East tensions remain a key market driver, but a temporary Israel-Iran ceasefire helped cap oil price gains, reducing immediate inflation fears and supporting risk sentiment.
• Investors remain focused on higher interest rates and liquidity risks in mega-IPOs, with Treasury yields remaining elevated as upcoming listings such as SpaceX continue to raise questions about capital allocation across global equity markets.
• Chart of the day: AUD/USD’s rebound from Monday looks like a “dead cat bounce”. Watch the 0.7085/710 key short-term resistance.

The 0.7% rebound in AUD/USD from Monday’s Asian session intraday low of 0.7024 has been lacklustre. The hourly RSI momentum indicator has been capped below its descending resistance at around 58 (see Fig. 1).

These observations warrant caution that Monday’s rebound may be a “dead cat bounce” within a bearish structure that has been unfolding since the bearish break below the 50-day moving average on last Friday, 5 June 2026.

Watch the 0.7085/7100 key short-term pivotal resistance; a break below 0.7024 near-term support opens scope for potential weakness towards the next immediate supports at 0.7008/0.6995 and 0.6960/6945.

On the flipside, a clearance with an hourly close above 0.7100 invalidates the bearish tone and opens the door to a squeeze up to retest the 20-day and 50-day moving averages, which converge at the next intermediate resistance of 0.7120 and 0.7153.

• Dip buyers unleash historic chip rally: Following a brutal selloff that saw global tech benchmarks routed late last week, dip buyers returned to Wall Street in force. The Nasdaq 100 rallied 1.6%, and the S&P 500 jumped 0.3% to close above 7,405, powered by a massive 5.6% to 6.5% resurgence of semiconductor giants like Micron Technology and Intel Corp. In contrast, the Dow Jones Industrial Average underperformed, losing 0.2%.
• Trump ceasefire call caps geopolitical oil surge: Crude oil sharply pared its early 4% weekend gains after a tenuous, temporary ceasefire was brokered between Israel and Iran. While Israel hit petrochemical targets in southwestern Iran over the weekend, Reuters reported that both sides subsequently lifted flight and movement restrictions, signalling a tentative pause in direct hostilities.
• SpaceX counts down to historic $75 Billion IPO: Elon Musk’s SpaceX is moving ahead with plans to raise $75 billion by offering 555.6 million shares at a fixed price of $135 per share. The historic listing, scheduled for this Friday, skips typical bookbuilding price ranges due to massive pre-IPO institutional demand, commanding a fully diluted valuation of $1.77 trillion.
• Fed hike fears soften on wage metrics: While a massive 172,000 nonfarm payroll expansion on Friday initially stoked hawkish monetary fears, institutional desks spent the session reassessing the data. Wall Street sentiment turned positive as analysts noted a cooling trend in underlying wage growth, prompting banks to downplay the imminent risk of an October Fed rate hike.
• 'Sell Indonesia’ sweeps regional trading desks: Concerns over interventionist economic management and confusion regarding new commodity export rules have sent Indonesian assets into a spiral. Just five months after hitting a record high, the benchmark Jakarta stock index plunged, bringing its total decline to 36% and making it the worst-performing global index in 2026, while the rupiah collapsed to a new low of 18,180 against the dollar.

• A healthy reset in crowded tech allocations: Wall Street’s leading strategists messaged that last week’s deep pullback was an essential positioning reset rather than a structural market top. Citigroup aggressively raised its year-end S&P 500 target to 8,100 (a gain of around 9% from Monday’s S&P 500 closing level of 7.405), citing a significant step-up in corporate earnings power that will absorb upcoming mega-cap tech issuance, such as SpaceX and Anthropic.
• Cool reception for conceptual AI updates: Despite the broader chip sector’s explosive rebound, consumer tech companies bucked the trend. Apple Inc. shares slid 1.9% after investors gave a decidedly cool reception to the firm’s showcase of its next-generation AI platform, underscoring that markets are increasingly demanding immediate, quantifiable monetisation over product updates.
• Sovereign debt yield resurgence: As geopolitical alarms shifted to a low simmer in the Middle East, the safe-haven premium began draining from global bonds. Fixed-income yields remained anchored near multi-month highs, with global allocators bracing for massive upcoming government note auctions amid a structurally higher cost of capital.

Equities: The S&P 500 climbed 0.3% to settle at 7,405.73, and the Nasdaq 100 jumped 1.6%. But market breadth was weak, with only 3 of the 11 S&P 500 sectors recording gains: Technology (+1.5%), Energy (+1.1%), and Consumer Discretionary (+0.5 %). In Europe, the Stoxx 600 edged down 0.1% due to its lower semiconductor weighting.

Fixed Income: Yields pressed higher on hawkish central bank expectations. The US 10-year Treasury yield advanced to settle near 4.57%. Germany’s 10-year Bund yield ticked up to 3.06%, and the UK’s 10-year Gilt yield rose four basis points to 4.94%.

FX: The US Dollar Index lost its safe-haven traction, falling slightly by 0.1%. The euro caught a minor bid, hovering at $1.1538, while the British pound rested at $1.3350. The Japanese yen stabilised at around 160.20 per dollar.

Commodities: WTI crude finished up 1% on Monday to trade near $91.27/bbl, and Brent crude rose to trade near $94.10/bbl, both closing well below their early peaks. Spot gold clawed back a modest 0.05% to trade at $4,330/oz, hovering just above a near-term support of $4,250/oz.

• Stock markets under pressure: Before the New York tech rebound materialised, regional indices bore the brunt of global tech contagion. South Korea’s KOSPI index was severely damaged, falling by a staggering 5.5% on Friday as options market liquidations triggered a deep regional equity-clearing event. In today’s Asia opening session, technical rebounds have materialised, Nikkei 225 (+3.6%), KOSPI (+3.6%), CSI 300 (+0.3%), and STI (+0.9%).
• Rupiah trapped in historic lows: The Indonesian rupiah weakened about 7% year-to-date, making it one of the worst-performing currencies in Asia in 2026, and fell further to a low of 18,180 against the US dollar, forcing emergency central bank smoothing interventions.
• BOJ intervention floor monitored: The Japanese yen remains deeply pinned against the greenback at around 160.20. The Bank of Japan remains on maximum alert for direct spot-market intervention as wide yield differentials continue to structurally favour the U.S. dollar.

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