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Stock markets resume their downward trend

Stock markets resume their downward trend

Fed Chairman Powell did little to calm the troubled analysts & investors.

Mr. Powell said, in his second day of testimony in the US Congress, that Russia's war in Ukraine could affect the US economy by leading to a significant decrease in spending and investments, which translates into higher prices.

US stock indices, which had started the session with gains, fell to close with losses due to investors' fear of the threat of stagflation that Powell anticipated in his statements.

Investors are now wondering what the reaction of the Federal Reserve will be facing the threats of rising inflation and slowing economic growth. As was commented in the market, the fear is not because of possible stagflation but of the Fed's reaction in this scenario.

Paradoxically, suppose the US employment figure published today will show strength, especially in the wage component. In that case, it could be interpreted negatively in the market, considering that the Fed's reaction in terms of interest rates could be more aggressive than was expected just two days ago.

In short, indecision and uncertainty prevail in a market that continues to be dominated by news from Ukraine and the unpredictability of the conflict. The defensive stocks are the ones that have shown the best performance in the markets, while the growth stocks have suffered considerable losses.

Nasdaq was the most affected index, with more than 1.5% falls. However, from a technical analysis perspective, it didn’t suffer notable changes compared to the last days when it traded in a mixed manner, a characteristic movement of an indecisive market.

After reaching the maximum level of $116.50/barrel, oil corrected downwards. The black gold's price fell not because the conflict between Russia and Ukraine improved, which unfortunately is still in full war confrontation, but because news has arrived that an agreement has probably already been reached with Iran to lift sanctions.

According to the daily RSI, oil is in an overbought situation but still far from levels that can be considered as pivots or the beginning of a trend change.

Sources: Bloomberg, Reuters.

Informațiile prezentate în acest document sunt pregătite de Miguel A. Rodriguez și nu au intenția de a constitui consultanță pentru investiții. Informațiile din acest document sunt furnizate drept o comunicare generală de marketing cu scop informativ și, ca atare, nu au fost pregătite în conformitate cu cerințele legale concepute pentru a promova cercetările independente în domeniul investițiilor și nu sunt supuse niciunei interdicții de abordare înainte de diseminarea cercetărilor de investiții. Nu au în vedere obiective specifice de investiții, situații financiare sau nevoi specifice ale vreunui destinatar.

Utilizatorii/cititorii nu ar trebui să se bazeze exclusiv pe informațiile prezentate aici și ar trebui să facă propriile lor cercetări/analize, prin citirea cercetărilor de bază.

Key Way Investments Ltd nu influențează și nici nu are vreo contribuție la formularea informațiilor conținute de acest document. Conținutul acestui document este generic și nu ia în considerare circumstanțele personale ale fiecărui individ, experiența de investiții sau situația financiară actuală.

Prin urmare, Key Way Investments Ltd nu va accepta nicio responsabilitate pentru eventualele pierderi ale traderilor datorate utilizării sau conținutului informațiilor prezentate în acest document. Performanțele trecute și previziunile nu sunt indicatori fiabili ai rezultatelor viitoare.