The dollar is growing, the stock market is decreasing after the Fed meeting and negative reports from the tech sector

After continued growth, the world stock indices moved to a sharp decline amid many negative factors related to large business income, economic assessments, trends over the epidemic, and a decrease in retail trade in the United States. The dollar, currently holding the position of a safe-haven currency, resumed its correctional growth.

Nasdaq 100 futures fell after disappointing reports from giants such as Apple Inc. and Tesla Inc. Hong Kong and Australia stocks were the fastest to fall in Asia. European futures contracts opened tradings with the decline too.

On Wednesday, the S&P 500 declined by 2.6% after the Fed left its benchmark interest rate unchanged and made it plain that the central bank wasn’t going to cut its bond buybacks. At the same time, no increase in volume is expected, despite the slowdown in economic recovery. Against this background, 10-year Treasury bonds broke through the round 1.00% level from top to bottom.

Equity markets remain vulnerable amid progressive “bubble” discussions and slow vaccination rates. Amid the raging pandemic, the European Union was unable to resolve the dispute with AstraZeneca over vaccine supplies, which increased the risk of additional delays in vaccination of the block's population. Wall Street is expecting a significant pullback, but only within the framework of the correction, since, in their opinion, there is no reason for panic now, and long-term fundamentals are promoting growth.

Today, the market will assess how the US economy closed 2020. The fourth-quarter GDP report, which will be released today, is the first preliminary estimate and could cause high volatility across the entire market spectrum.

Main market quotes:

S&P 500 (F) 3,728.62 -15.63 (-0.42%)

Dow Jones 30,303.17 -633.87 (-2.05%)

DAX 13,451.20 -169.26 (-1.24%)

FTSE 100 6,501.75 -65.62 (-1.00%)

USD Index 90.707 +0.067 (+0.07%)

• – The US GDP (Q/Q) (Q4) at 15:30 (GMT+2);
• – US Initial Jobless Claims at 15:30 (GMT+2).

by JustMarkets, 2021.01.28

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.