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[US market conditions]Stocks continue to fall, weekly sharp drop since March 2008-high-tech sales continue-Bloomberg

The US stock market on the 21st continues to fall. It was the worst week since about two years ago when the market was first shaken by the new coronavirus. High-tech stocks were sold as high interest rates made investors nervous due to rough price movements due to weak financial results of some companies.

  • U.S. stocks have fallen sharply, high-tech stocks have not stopped selling
  • US Treasuries are generally strong, yield curve flattened
  • In the foreign exchange market, buying as an escape currency, the influence of US-Russian tensions, etc.
  • NY crude oil continues to fall, stocks and copper fall
  • NY gold has fallen sharply, inflation expectations have fallen

The S & P 500 Index closed below the technical milestone of the 200-day moving average for the first time after 2020. The decline in the Nasdaq 100 Index, which has a high weight of high-tech stocks, was conspicuous. Among them, Netflix has dropped by more than 20%. Sales of crypto assets (virtual currency) in general continued, and Bitcoin also plummeted. It broke below $ 38,000 at one point and hit a low for the first time in about five months.

S & P 500 species decreased by 1.9% from the previous day to 4397.94. The Dow Jones Industrial Average is down $ 450.02 (1.3%) to $ 34265.37. The Nasdaq Composite Index fell 2.7%.

Volatility from the beginning of the month has shown no signs of calming down. S & P 500 species fell for 4 days in a row, down 5.7% this week. On a weekly basis, including holidays, it has fallen sharply since March 2008. The final trading of options over $ 3 trillion has also amplified market volatility.

“I think it was the longest shortened week in history,” said Jay Peroski, founder and president of TPW Investment Management, noting that Monday was closed. “It was four days, like two weeks in one,” he recalled.

S & P 500 species (white), 100-day moving average (green), 200-day moving average (yellow)

Source: Bloomberg

US Treasury market is rising. In addition to the bulk buying in the morning on futures, government bonds were bought as stocks were sold late in the day. Long-term bonds were particularly strong due to the impact of short buybacks. On the upside, the bearish position of the option was tampered with.

As of 4:03 pm New York time, 10-year bond yields have fallen by 5 basis points (bp, 1bp = 0.01%) to 1.74%. At one point, it dropped to 1.7315%. Spreads on 2-10 and 5-30 year bonds narrowed.

Escape destination currencies are strong in the foreign exchange market. The background is the decline in government bond yields worldwide. The market is poised for heightened tensions between the United States and Russia.

The Bloomberg Dollar Spot Index, which shows the movement of the dollar against the 10 major currencies, fell 0.1%. The dollar is down 0.4% against the yen at 1 dollar = 113.67 yen. At one point, it dropped to 113.61 yen, the lowest price since January 14. The euro is 0.3% higher than the dollar at 1 euro = 1.1343 dollars.

New York crude oil futures prices continue to fall. In addition to the stock market, selling became dominant as the prices of materials such as copper fell. The New York Mercantile Exchange (NYMEX) West Texas Intermediate (WTI) futures March contract ended at $ 85.14 a barrel, down 41 cents (0.5%) from the previous day. In the week, it was high for 5 consecutive weeks. The March contract for Brent North Sea in London ICE is $ 87.89, down 49 cents from the previous day.

New York gold futures are significantly cheaper. The yield gap between US inflation-indexed government bonds and interest-bearing government bonds narrowed, and sales expanded. The New York Board of Trade (COMEX) gold futures April contract ended at $ 1834.10, down 0.6% to 1 ounce. However, it increased for the second consecutive week in the week.

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