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S&P 500 (SPY) Remains Under Pressure At The Start Of The Week

By:
Vladimir Zernov
Updated: Sep 27, 2022, 06:33 UTC

REITs are testing new lows as Treasury yields keep moving higher.

S&P 500

In this article:

Key Insights

  • The stock market is falling as traders sell riskier assets amid recession worries.
  • Strong dollar and rising Treasury yields serve as additional bearish catalysts for stocks. 
  • The pullback is broad, and all market segments are under pressure. 

S&P 500 Retreats As U.S. Dollar Tests New Highs

S&P 500 continues its attempts to settle below the support level at 3660 as traders move out of riskier assets.

Treasury yields are testing new highs. Currently, the yield of 10-year Treasuries is trying to settle above the 3.85% level. At the start of August, 10-year Treasuries yielded just 2.60%, so the recent upside move was huge.

Higher Treasury yields put significant pressure on REITs. Kimco Realty, Ventas, Prologis, and Vornado Realty are among the biggest losers in the S&P 500 today.

Energy stocks have also found themselves under pressure as WTI oil tested new lows. Baker Hughes, Hess, and Halliburton are down by more than 3% in today’s trading session.

Some tech stocks, like Apple and Amazon, are trying to rebound today. Other tech stocks, which have been weak in recent weeks, continue to move lower. Meta and NVIDIA are testing new lows.

It should be noted that strong dollar also serves as a negative catalyst for U.S. stocks by making them more expensive for foreign investors. Today, the U.S. Dollar Index tested highs that were last seen back in 2002. Dollar’s strength highlights the global flight to safety, which is bearish for riskier assets like stocks.

S&P 500 Tries To Settle Below The Support Level At 3660

S&P 500

From a technical point of view, RSI has recently entered into the oversold territory, so the risks of a rebound are increasing. This year, RSI has been at current levels in late January, after the strong pullback.

This time, the panic looks strong, so RSI may move to lower levels without a rebound. It remains to be seen whether the market is ready for a flash sell-off, which happened during the coronavirus crisis. However, the current pullback is broad, and the recent moves in currency markets show that investors are very nervous.

For a look at all of today’s economic events, check out our economic calendar.

About the Author

Vladimir is an independent trader and analyst with over 10 years of experience in the financial markets. He is a specialist in stocks, futures, Forex, indices, and commodities areas using long-term positional trading and swing trading.

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