Nasdaq 100 futures trim losses to 1% as dip buyers emerge before NFP

Nasdaq 100 futures recovered to 30,170.15, narrowing their decline to less than 1% after a tech-driven selloff swept across Asian markets.

"The intraday reversal suggests traders are treating this as a buying opportunity rather than the start of a deeper correction," said Sarah Lin, equity strategist at Edgen. "But with nonfarm payrolls looming, conviction remains thin."

The recovery followed a sharp intraday plunge in South Korea's KOSPI index, which fell as much as 6.4% before rebounding to erase most of the session's losses. MSCI's broadest index of Asia-Pacific shares dropped 1.3%, with Japan's Nikkei 225 declining 1.3% and Hong Kong's Hang Seng falling 1.1%. China's Shanghai Composite slipped 0.7%. S&P 500 futures were down 0.7%, while Dow Jones Industrial Average futures held flat.

The selloff shows how vulnerable equity markets have become after months of AI-driven gains. The Nasdaq 100 has rallied nearly 35% from its March low to its June peak, with only one meaningful pullback — a three-day dip — along the way. Friday's nonfarm payrolls report will test whether the dip-buying momentum can hold.

The KOSPI's intraday collapse — the largest single-day swing in months — appeared to lack a single trigger, with traders pointing to a combination of profit-taking ahead of the US jobs report and growing unease about stretched valuations in AI and semiconductor stocks. South Korea's benchmark is the world's best-performing index this year, driven by its heavy exposure to the AI supply chain. The index had surged more than 30% year-to-date before Friday's shakeout.

Sector rotation was evident beneath the surface. While technology and semiconductor names led the decline — with Broadcom Inc. dragging the Nasdaq lower in the prior session and chip equipment maker ASML Holding NV falling 3% — defensive and industrial sectors held up better. The Dow Jones Industrial Average logged a record closing high on Wednesday even as the tech-heavy Nasdaq Composite slipped, highlighting the divergence between old-economy and growth stocks.

The U.S. 10-year Treasury yield fell two basis points to 4.464%, while the dollar edged lower, with the Wall Street Journal Dollar Index slipping 0.1% to 95.97. Brent crude dropped 0.3% to $94.72 a barrel, adding to recent losses as a fragile Middle East ceasefire holds. European stocks also declined, with the Stoxx Europe 600 falling 0.2%, led by a 4.8% drop in chipmaker Infineon Technologies.

From a technical perspective, the Nasdaq 100 futures found support near the 30,000 high-volume node, a level that has acted as a magnet for price action in recent weeks. A break below 29,744 would open the door to a deeper pullback toward the May value area around 29,290, according to market technicians. The VIX, Wall Street's fear gauge, rose during the session as options traders priced in increased volatility ahead of the payrolls data.

This article is for informational purposes only and does not constitute investment advice.