Business Maverick: Tech Rout Hits Stocks as Hike Frenzy Boosts Yields: Markets Wrap

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Stocks dropped and bond yields hit multiyear highs after a slew of global central banks joined the Federal Reserve in hiking interest rates to curb scorching levels of inflation at the expense of economic growth.

also followed with hikes of their own as officials rush to get to grips with rampant price increases.

It has traded below its 200-day moving average for over 100 sessions — a streak that was previously breached only during the tech bubble and the global financial crisis in the past 30 years. In both of those instances, the gauge posted most of its losses after surpassing that level, with the index declining by a further 50% in 2000-2003 and 40% in 2008-2009 before troughing, they said.

“The bad news is we are still in one of the weakest seasonal windows of the year, especially in a mid-term year,” said Jonathan Krinsky, chief market technician at BTIG. “The good news is that it quickly reverses by mid-October. We think we test or break the June lows before then, which should set up a better entry point for a year-end rally.”

“It’s tough to get long until we get signs of slower underlying demand growth, but tail risk is limited by already tighter financial conditions, lower PEs, and higher implied vol,” he wrote.

 

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