The Standard and Poors 500 index (SPX) closed today at 7458, down 76 points for a loss of 1.0%. SPX opened the week at 7548, setting up a weekly loss of 1.2%. SPX appears to have found support at its 50 dma. Trading volume continues to run below average. 

VIX, the volatility index for the S&P 500 options, opened the week at 16.1% and closed today at 18.8%, up 17%, with the bulk of this week’s rise occurring today.

I monitor the movement of high beta stocks by tracking the ETF containing the top 100 S&P 500 stocks ranked by beta, SPHB. SPHB closed today at 140.9, down two points or -1.4%. SPHB opened the week at 147.6, setting up a weekly decline of 4.5%. SPHB  dropped through its 50 dma on Thursday. Trading volume was above average all week with significant spikes yesterday and today.

The NASDAQ Composite index closed today at 25,520, down 362 points or -1.4%. NASDAQ opened the week at 26,088, setting up a weekly loss of 2.2%. NASDAQ dropped through its 50 dma on Thursday and remains well below it today. Trading volume ran below average all week. 

This week’s market turned in a very negative performance with the S&P 500 losing 1.2%, NASDAQ declining 2.2%, and the S&P High Beta stocks losing 4.5%. In addition, the S&P volatility index, VIX, increased nearly 17%. 

Earnings reports from NFLX, TSMC and Samsung beat estimates but declined after the announcements. Semiconductors sold off significantly, declining 20% from their June highs, but semiconductors remain up 60% for the year.

Oil prices rose about 4% due to the increased conflict in Iran. But the CPI and PPI showed signs of declining inflation rates.

China’s Moonshot AI was released and appears to threaten America’s lead in AI. This may account for the weakening in the semiconductor indices, fearing a slowing in the data center developments. Investors will be watching Google’s earnings announcement on Wednesday to see if AI spending is declining.

It is notable that this week’s rise in oil prices was less than earlier this year when this conflict began in Iran. It seems that oil market analysts have reduced their concerns about oil supplies being in jeopardy.

In summary, the market is spooked but much of the economic date is very solid. Longer-term market prospects remain positive, but market volatility will remain high. Be cautious.