The markets’ upward momentum was halted yesterday without any news or fundamental data to justify it. This could be due to the change of market flow from technological stocks to industrial stocks and others like airlines. And as investors rule out Omicron's induced slowdown, the rotation flow accelerates. Analysts now wonder whether this market position makes sense or if there is an excess of optimism among investors.
Uncertainty remains high, and the potential economic consequences deriving from the measures already taken to fight Omicron are yet to be seen. They cannot be compared to those taken at the start of the pandemic. However, for almost a month now, activities in the service sector have been restricted globally, and China has confined an entire province.
The disparate behavior of indices was reflected in rises in the DowJones 30 and slight retraces in Nasdaq value, with the S&P500 in the middle of the two, closing practically unchanged during the session.
Technically, Tech100 has reversed its upward movement around 16,655, making this level its main resistance zone.
Oil, which rose simultaneously with stock indices, driven by the same positive economic sentiment, also halted its bullish run yesterday.
Pending the crude inventory data scheduled for today, oil failed to pass the level of 76.46, which now acts as primary resistance point.
Sources: Bloomberg, Reuters.