all retreated US stock indices Main, for the second week in a row, as the markets were hit hard by the dot chart ofFedand weak economic data, which in turn reinforced expectations of an imminent economic recession in United State.
Investors expressed concern regarding economic growth, and regarding the direction in which the US economy will be driven by the path of the Fed’s tightening of monetary policy, given that Powell acknowledged that a smooth landing would be difficult, and also emphasized the great interest that the Fed was paying to bring the inflation rate back close to its level. The target.
Most US stocks fell every day of the week except for Wednesday, the day the Federal Open Market Committee issued its interest rate decision, as traders received Powell’s statement that “a 75 basis point Fed rate hike is not a common move” positively. .
On Friday, some stock indices ended slightly higher, as sharply lower oil prices offered some hope that inflationary pressures might abate, prompting the Federal Reserve to act less aggressively.
All US stock indices entered the bear market area this week, as the S&P 500 closed the week down by 5.79%, to settle at a level 30.98% lower than its level since the beginning of the year.
All 11 sectors included in the index declined by more than 4%, with the energy sector declining by 17% and topping the list of losses.
On the other hand, according to the model released by JPMorgan Chase & Co., the S&P 500 index currently indicates that the chance of a recession in the United States is 85%, as the markets fear a mistake in Fed policy.
Moreover, according to Bloomberg, the percentage of S&P 500 stocks trading above the 50-day moving average has fallen to less than 5% this week, its lowest level since the start of the coronavirus pandemic in early 2020.
The Russell 200 index of small cap companies and the giant Dow Jones Industrial Average both declined by 7.48% and 4.79% respectively, with the former underperforming this week.
As for the giant technology indices, the Nasdaq Composite and the FANG+ fell by 4.78% and 4.58%, respectively.
Market volatility increased, as the markets witnessed a difficult week, as the VIX index to measure market volatility jumped by 3.38 points to reach 31.13 points, which is higher than its average for the current year of 26.28 points since the beginning of the year to date.
Turning to Europe, most major European stock indices closed the week lower and entered bear market territory, as investors assessed the implications of monetary policy tightening on global economic growth, following many of Europe’s central banks such as the Bank of England, the Swiss Central Bank and the Federal Reserve raised The Fed this week interest rates.
The STOXX 600 index closed down by 4.60% during this week’s trading, as the index incurred losses on most days of the week, except for Wednesday and Friday.
On Wednesday, European stocks rose, as the European Central Bank held an emergency ad hoc meeting and vaguely addressed its willingness to use tools to combat market fragmentation, and markets viewed Powell’s comments as positive.
Similar to their US counterparts, European stocks posted modest gains during Friday’s trading with lower oil prices.
European regional stock indices also witnessed strong weekly losses, with the French CAC 40 (-4.92%), the German DAX (-4.62%), the British FTSE 250 (-3.80%) and the Italian FTSE MIB (-3.36%) closing. This week’s trading is down.
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