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S&P 500 an Uptrend in the Bond Market Pushes the Price Down

2/27/2023 12:25 PM

Quotes of the S&P 500 stock index are correcting down to 3972.0 under pressure from the upward dynamics in the bond market, only slightly reacting to the publication of corporate reports.

One of the world's leading online commerce platforms, Alibaba Group Holdings Ltd. ADR reported 247.76 billion dollars in revenue, well above the previous quarter's 207.18 billion dollars. In turn, the online booking service Booking Holdings Inc. recorded revenue of 4.0 billion dollars, down from 6.1 billion dollars a quarter earlier, while earnings per share more than halved to 24.74 dollars from 53.03 dollars in the previous quarter.

The US bond market continues to grow: 10-year treasuries are already nearing the key level of 4.000%, trading around 3.943% for the first time since December last year, and 20-year bonds have long since crossed this threshold, trading at 4.106% yield, which looks much more attractive and reliable for investors than a rally in the stock market.

The growth leaders in the index are Linde Plc. (+4.75%), Edison International (+4.21%), Coterra Energy Inc. (+3.61%), Hess Corp. (+2.32%).

Among the leaders of the decline are Autodesk Inc. (-12.95%), Adobe System Inc. (-7.63%), Moderna Inc. (-5.63%).

The index quotes continue the local corrective trend, approaching the support line of the ascending corridor on the daily chart.

Technical indicators reversed and issued a sell signal: the fast Alligator indicator EMAs crossed the signal line from above, and the AO histogram moved to the sales area, forming descending bars.

Support levels: 3920.0, 3750.0. | Resistance levels: 4040.0, 4200.0.

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