After so many and so many months of interrupted rises, the United States stock market is giving the first signs that this scenario may have passed away. In this sense, there are not a few financial analysts who believe that there is very little left to move to short positions in the American S&P 500 index. Also, setting the benchmark to leave this financial market and that it would be quantified at levels very close to 2.700 points that would be the benchmark to start sales.
Another derivation of a change in trend in equities would be its influence on the stock indices to the other side of the Atlantic and that investors from the old continent could bring losses of a certain ether intensity. Faced with this scenario, there is no choice but act with great caution and above all rationally and despite the fact that the months of November and December are traditionally very buyers. Where the long-awaited rally of the Christmas festivities makes an appearance.
In any case, the rise in the interest rate on the part of the Federal Reserve of the United States (FED) may lead to these worrisome new scenarios for equity markets. Especially if interest rates rise with greater intensity than predicted by financial analysts. In which case, the losses could be accentuated from these precise moments. Not in vain, it is a risk that you have to count on if you are going to opt for buying shares on the stock market in a very complicated period like the current one.
Bearish trend in stocks
One of the big surprises in recent weeks is that equities in the US markets are losing a lot of price in their valuation. To the point that sell positions Investors are imposing themselves with crystal clear clarity on the buyers. Where, a deep analysis in the technology sector can help to find one of the main reasons for the current bearish current in the financial markets of the United States. What happens in the next few days will be very important to decide in the end if it is time to buy or sell the positions on the stock market.
On the other hand, we cannot forget that equities in this geographical area have risen steadily for more than five years and year after year. This process may have come to an end and the values will be dedicated from now on to Set the price of your actions. At the moment it is not possible to decide if what is happening these days is a mere adjustment of the stock indices or on the contrary it is a movement much more worrying for the interests of small and medium investors.
S&P 500 Current Scenario
In any case, there is one thing that can help investors make a decision one way or the other. It is none other than the S&P 500 has started a great lateral movement that can last throughout 2019. Although a radical change in trend can also occur if some of the most relevant supports of this important equity market are knocked down. To the extent that the most reasonable option would be sell or wait, depending on the status of your operations on this stock exchange in the United States.
On the other hand, the significant slowdown in China's economic growth and emerging countries, which also slows down German economic growth and, therefore, that of Europe, and its stock markets can exert a pressure factor on the different indices of the American stock market. Where it is expected for the S&P 500 that the average earnings per share of listed companies will decelerate to levels slightly above 23% in 2018, 6% in 2019 and at least in 2020, which would be around at 4%. It is a scenario, in any case, with which it would be much more complicated to operate with these financial assets.
Trump's controversial explanations
The president of the United States, Donald Trump, has spoken about these falls in the American equity markets. And his explanation could not have been more controversial for the different financial agents. His explanation is that these movements are originated as a consequence of the result of the recent elections to Congress of Deputies and the Senate and that brought a greater presence of Democratic politicians to the first of the houses of representation of this powerful country.
Of course, these reasons are not very explainable when the day after these results were known, the equity markets greeted them with significant gains. Rather, the causes must be found in explanations derived from the financial markets themselves. Especially those linked to a excessive tiredness by the US stock exchanges. Now what will be necessary to detect is if this that is happening is something more than a correction in the price of the securities.
Start in the stock market decline
Keep in mind that the S&P 500 started the week going through a corrective phase of the previous rise, which developed with the step from 2.600 to 2.920 points. It is the American technology sector that is showing the greatest signs of weakness by pointing to its biggest drops in many months. This is a very powerful signal about what may happen in the next few days or weeks. Not in vain, the Nasdaq xnumx anticipates future movements of the more traditional indices, as has happened in recent years.
One of the most common advice from the most famous financial analysts is that while the S&P 500 remains below 2.800, the most profitable position will be to be in liquidity given the downward predisposition of these markets on the other side of the Atlantic. Therefore, these are critical moments to show what is the trend that will eventually emerge from all this corrective or bearish process. Where monetary decisions can also do their bit to opt for one or another trend from now on.
Background of the USA stock market
The US stock market has generated one of the best periods of rises in its history and that has led to investors' capital gains reaching levels even very close to 100%. Where the revaluation of the most relevant index of this relevant market, the Standard and Poor's 500 has shown an increase of over 200% since 2009. In what is considered as the longest rise period of share prices in this geographic area. Well above the ratios shown by all the stock exchanges of the old continent.
In another vein, the divergence between the American and Spanish stock markets is more than evident. So its potential for declines in the stock market is much more evident, with deeper fixes, both in terms of its intensity and in the period that can last from these moments. In any case, it is the period of greatest weakness since the uptrend began and which may lead to a much more profound change in trend than predicted by some of the most relevant equity market analysts.
Stocks with the biggest drops in the US
The week could not have started worse for the US financial markets. Not surprisingly, Wall Street has started the week with heavy losses, led by a series of companies of special relevance, such as are Apple, Amazon, Goldman Sachs and General Electric. Such has been the intensity of these depreciations that the Dow Jones has dropped 2,3%, while on the contrary, the S&P 500 has depreciated at levels of 2%. The technological index par excellence has fared much worse, which has plummeted by almost 3%.
Nor can the strong downturn suffered by one of the most iconic equities in the United States be overlooked. This is the case of Goldman Sachs shares that have been left almost 8% and to reach levels very similar to those of 2016. In this case, fueled by the alleged bribes in Malaysia that have taken their toll on their valuation in the financial markets.
A fact that can contaminate other securities in the sector in the coming days and even the stock market proposals in this part of the continent. With perspectives that are very negative for people who want to invest their savings. With a very negative effect on the futures market of the Asian markets, which sharpen their falls with great intensity. Where monetary decisions can also do their bit to opt for one or another trend from now on.