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DJIA Market Update

3/14/2023 1:01 PM

The Dow Jones index is correcting in the local trend, trading at 31917.0.

Volatility in the US stock market has increased again amid reports of the bankruptcy of large venture capital banks. So, on Friday, trading in shares of Silicon Valley Bank was suspended, and by the evening the regulatory authorities stopped the activities of the financial organization. On Sunday, the authorities had to close Signature Bank, after which US President Joe Biden addressed the nation, announcing the launch of an emergency support program for credit institutions, as well as that depositors of affected banks will have access to their savings.

Despite the assurances of the state authorities in support, the shares of the banking sector continue to decline, and this is most clearly seen on the example of small organizations. Thus, the shares of First Republic Bank lost 75%, and of PacWest Bancorp — 52%, which led to the suspension of trading. In turn, the quotes of Comerica Inc. decreased by 44%, and of KeyCorp — by 38%. Despite the local correction now, the situation remains tense and does not contribute to new investments in the stock market.

The growth leaders in the index are Amgen Inc. (+2.33%), Microsoft Corp. (+2.14%), Salesforce Inc. (+1.35%). 

Among the leaders of the decline are American Express Co. (-4.87%), Goldman Sachs Group Inc. (-3.71%), Dow Inc. (-2.75%).

On the daily chart, the index quotes continue their corrective dynamics, falling below the support line of the local corridor.

Technical indicators reversed and issued a sell signal: the range of EMA fluctuations of the alligator indicator expands in the direction of decline, and the AO histogram forms new correction bars, being below the transition level.

Support levels: 31500.0, 30080.0. | Resistance levels: 32500.0, 33600.0.

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