🚨The benchmark of smaller-cap companies erases post-election gains
As the American capital market wakes up on the first day of the new week, futures on US indices are extending Friday’s declines. Everything points to today’s cash session on Wall Street being a bearish one. At the time of writing, the US500 index is down 0.64% at 5830 points, US100 is trading 1.00% lower at 20800 points, and US2000 is losing 1.10% at 2177 points.
Last week, investors received plenty of arguments for further sell-offs. At the beginning of the week, we got strong ISM data along with a record-high price subindex. Then, inflation concerns were raised by a University of Michigan report, which showed the largest increase in 5-year consumer inflation expectations since 2008. The week ended with a strong NFP reading, which reassured investors about the Fed’s hawkish stance in 2025.
Start investing today or test a free demo
Create account Try a demo Download mobile app Download mobile appMeanwhile, the new week begins with further strong increases in oil, the dollar, and yields, which in turn maintains downward pressure on equities and sustains inflation risk. Investors’ attention will soon focus on Wednesday’s December CPI reading, which could be another major catalyst. Nevertheless, we should not yet see the full impact of rising energy prices in December data. Summing up the macroeconomic picture, the second half of January should be very interesting. Over the next two weeks alone, we expect the US CPI report, Trump’s inauguration, and the Fed decision.
US2000 – Technical Overview (D1 Interval)
Russell 2000 was the first major US index to completely erase the gains fueled by Donald Trump’s presidential election victory. What’s more, the US2000 has broken below the key support zone of the upward trend, which is the 200-day exponential moving average (the gold curve on the chart).
Source: xStation
US100 – Technical Overview (D1 Interval)
For the tech-company benchmark, the declines have reached the 100-day exponential moving average, although the scale of the drop has not been sufficient to erase the “election” gains yet.
Source: xStation
