An analysis of the market sell-off: What's likely causing it and how worried you should be

The S&P 500 has dropped 3% from its record high. Economically cyclical groups have been purged. Bonds are leading stock returns one month into the year.

Bond yields have rushed toward their old lows, flattening the gap between very short-term and 10-year Treasuries. World growth expectations are rolling over, as China's work and travel restrictions to contain the Wuhan coronavirus defer the payout of the trade-peace dividend that investors expected after the U.S.-China trade deal.

. Something was bound to come along and prompt a pullback. As it happened, the viral outbreak arrived to do the job, in the process fogging the growth outlook and draining risk appetites.The action and Wall Street narrative recall the backdrop to the August-September market retrenchment. So, what does that period imply about the correct playbook now?

Tim Hayes, chief global investment strategist at Ned Davis Research, noted the worldwide recoil from risk and said, "To an increasing extent, breadth indicators reflect downside momentum, yet sentiment indicators are far from indicating that the excessive optimism has given way to extreme pessimism. And it has yet to become evident that the market has adjusted to the probability that the outlook for economic growth and earnings is less favorable than suggested by the stretched valuations.

Last year, of course, the Fed delivered three rate cuts, and after it went on hold and U.S. GDP remained roughly at 2%, the markets effectively concluded that it could enjoy the gain of easier money without the pain of a punishing downturn.

Really, an analysis of what’s causing it?

South Africa South Africa Latest News, South Africa South Africa Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Friday's massive sell-off ruins 'January barometer' market signalAs goes January, so goes the year — the widely-watched 'January barometer' suggests a correlation between January's performance and full-year returns. Fucking virus So BTFD? The criminally corrupt financial media did its job for the WS organized crime ring, fomented a massive sell off on fake fears..if you bought into this scam few months ago, don’t worry there will be another pump & dump, I’d suggest you get out alive and stay out of this racket.
Source: CNBC - 🏆 12. / 72 Read more »

Stock market live updates: Dow plunges into the close, coronavirus fears grow, airlines fall5 experts weigh in on what the long and short-term implications of the coronavirus could mean for the economy and the markets. China is already sucesfully treating coronavirus 2019 with hiv medication, Hopefully scientist can start with the hiv medication in search of a vaccine.
Source: CNBC - 🏆 12. / 72 Read more »

‘Godfather’ of technical analysis says stock-market downturn is going to get worse: ‘I am looking at a 10% drop maybe a little bit more’It is going to get worse before it gets better for the stock market, says prominent technical analyst Ralph Acampora. Not til after Trumplenuts wins. At that point, he’ll be in for the fight of his life, to hold it all together for the next 4 years. That's all well and good, but what does Sylvia Browne think is going to happen? The end of short selling
Source: MarketWatch - 🏆 3. / 97 Read more »