Key Points:
- S&P 500 touches session low at 5,532.85.
- Market sentiment weakened by rising recession fears.
- Tech and financial sectors highlighted as potential recovery areas.
S&P 500 Extends Losses on Recession Concerns
The S&P 500 Index extended recent declines, hitting a session low of 5,532.85, reflecting trader unease over a potential shallow recession in the US. Recent market volatility has erased all post-election gains, raising doubts about future growth prospects.
The current market declines may indicate that we may be nearing a bottom–presenting potential opportunities in technology and financial stocks, despite their recent falls. The sharp sell-off in tech seems excessive, presenting attractive entry points for long-term traders.
Financial stocks also stand out due to their resilience, particularly against tariff-related risks, making them a strong consideration in the current market landscape.
However, traders are advised to exercise caution in consumer discretionary stocks. Lower-income consumers remain vulnerable to economic pressures, though higher-income segments may show greater resilience.
Technical Outlook
Picture: S&P 500 plunges nearly 9%, closing at 5,588.97 as recession fears drive market uncertainty, as seen on the VT Markets app.
The S&P 500 index experienced a sharp decline, dropping nearly 9%. Closing at 5,588.97 after opening at 5,579.55, the index tested a high of 5,597.48 before facing strong selling pressure, dipping to a low of 5,532.85.
The moving averages (MA 5, 10, 30) indicate a downward trend, with short-term MAs sloping lower, reflecting bearish sentiment. The MACD (12,26,9) histogram remains in negative territory, signaling sustained downward momentum, though a slight recovery attempt is visible.
Key support is now seen at 5,532.85, with a break below this level potentially accelerating losses. Resistance is at 5,597.48, where sellers remain active. If recession fears intensify, further downside risk remains in play.
Market participants should closely watch upcoming US economic data, particularly employment figures and inflation indicators, for further clarity on the Federal Reserve’s monetary policy trajectory.
Developments in US trade policy and corporate earnings from tech and financial sectors will also strongly influence market sentiment in the coming sessions.
