US500 deepens month-end declines and halves the recent upward wave
August ends very poorly for the stock market. The S&P 500 is likely to end the month with about a 4% decline, although from the monthly peak the declines are close to 8%. The rebound that began in June, due to the so-called "Fed Pivot," has been halved to an increase of about 9%.
Why the recent declines? It's the valuation effect of strong hikes in the US. There is a chance of a 75bp hike in September in the US and hikes this year to as high as 4%. Data from the US is not doing badly, but there are suggestions that the labor market will very soon begin to reflect the coming recession.
Start investing today or test a free demo
Create account Try a demo Download mobile app Download mobile appIt's worth noting that it's not just Wall Street that has leveled the rebound due to expectations of a less tight Fed. Gold returned to the $1,700 area, and oil in the last session significantly reduced the biggest upward correction in the last few months.
The US500 is deepening declines on the back of rising yields. The 50.0 retracement of the last upward wave is currently being tested, but the US500 has fallen below important support points, namely the 4,000-point level, the 100-period average and finally the 50-period average. The next target of the current declines may be located at the 61.8 retracement. In case of a recovery, the most important resistance is located in the area of 4050 points at the 100-period average. Source: xStation5
The content of this report has been created by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, (KRS number 0000217580) and supervised by Polish Supervision Authority ( No. DDM-M-4021-57-1/2005). This material is a marketing communication within the meaning of Art. 24 (3) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (MiFID II). Marketing communication is not an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC and Commission Delegated Regulation (EU) 2016/958 of 9 March 2016 supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the technical arrangements for objective presentation of investment recommendations or other information recommending or suggesting an investment strategy and for disclosure of particular interests or indications of conflicts of interest or any other advice, including in the area of investment advisory, within the meaning of the Trading in Financial Instruments Act of 29 July 2005 (i.e. Journal of Laws 2019, item 875, as amended). The marketing communication is prepared with the highest diligence, objectivity, presents the facts known to the author on the date of preparation and is devoid of any evaluation elements. The marketing communication is prepared without considering the client’s needs, his individual financial situation and does not present any investment strategy in any way. The marketing communication does not constitute an offer of sale, offering, subscription, invitation to purchase, advertisement or promotion of any financial instruments. XTB S.A. is not liable for any client’s actions or omissions, in particular for the acquisition or disposal of financial instruments, undertaken on the basis of the information contained in this marketing communication. In the event that the marketing communication contains any information about any results regarding the financial instruments indicated therein, these do not constitute any guarantee or forecast regarding the future results.
