The American stock market declines during the trading session on Thursday. The broad market index SP500 has lost 0.3% since the opening of the day and is quoted at 3390 points.
The index's recovery has clearly slowed down on the back of a halt in tech stocks. In recent days, the markets have been dominated by the volatility of the stocks of the largest tech companies, in particular Apple, Amazon and Microsoft. The drop in the tech sector has raised concerns that the market, which rose sharply in the summer, may be subject to further decline, as it is in the overbought zone.
Market pressure also continues to exert tensions between Washington and Beijing. More than 70% of companies surveyed by the American Chamber of Commerce in Shanghai expect geopolitical instability to lead to operational difficulties in the next 3-5 years. A year earlier, the share of respondents with such an answer was about 50%.
Market participants continue to follow the negotiations on new fiscal stimulus measures in the United States. In particular, in Congress, the parties are still unable to agree on a new package of financial assistance. Senate Republicans said Wednesday they would support a $ 300 billion cutback stimulus package, including unemployment assistance, business liability insurance and school funding. Democrats opposed the bill, and it is not expected to pass the first procedural hurdle.
Despite the current dynamics, the situation may change in favor of buyers. The next meeting of the US Federal Reserve will take place next week. While rates are close to zero, central bankers say they could boost stimulus to the economy by signaling how long short-term rates will stay low. They could do this by announcing what inflation and what labor market conditions will ensure that rates remain close to zero. In this scenario, the bullish rally in the SP500 could resume.
SP500 BuyLimit 3350 TP 3510 SL 3300
Analytical reviews and comments to them reflect the subjective opinion of the authors and are not a recommendation for trading. Author Artem Deev is a trader analyst at AMarkets . The social network of traders is not responsible for possible losses in case of using the review materials