Rise in rates, the war weighs heavily on the stock markets

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Analysis by Long Samnang, Commercial Director of Golden FX Link Capital

The stock market continued to fall due to geopolitical pressures and uncertainty surrounding rising interest rates.

As a result, on Tuesday the S&P500 fell 0.02% and the Nasdaq fell 0.14%, while the Dow Jones Industrial Average fell 0.11%.

The Russian-Ukrainian war that began in late February is clearly weighing on global stock markets.

According to the US Bureau of Labor Statistics, the consumer price index for March was 1.2% as expected and left the annual inflation rate at 8.5%, the highest since 1981.

This clearly signals a rate hike, and data from US Federal Reserve officials indicates that the Fed will raise interest rates by 0.50%.

US 10-year Treasury bonds have risen and are currently trading at 2.838%, down from 1.7090% on March 1, indicating that demand for the bonds has increased.

Interest in fixed income securities is increasing, driving up the value of the dollar and increasing pressure on the stock market.

The dollar index is currently trading at 100.86.

The VIX – the Chicago Board Options Exchange’s CBOE Volatility Index – is trading at 22.17, indicating fear is beginning to emerge in the stock market.

For this week’s trading recommendation, investors can sell the Nasdaq (Nas100) at 14000, setting the stop-loss function at 14170 and the take-profit function at 13600.

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