It may be just a short-lived noise, but investors seem to shift their worries about US inflation and the decline in optimism for growth over the coming months. The adjustment at the beginning of February was accompanied by an increasing bond yield curve, as robust wage growth simultaneously prompted the sale of shares and government securities. Right now, as stocks drop, the price of bonds (On the chart - the blue line) is rising. At the same time, the correlation between bond yields and the price of SP500 again returned to positive territory.
Looking at the latest US economic data, retail sales in February proved to be weaker than expected, and it did not appeal to Wall Street. Why? Because these are the first "clean" consumption figures after the high cost of Christmas and New Year holidays that have a strong negative impact on January Retail Sales.
Despite Trump's intention to appoint Larry Kudlow as an economic advisor, the indexes kept their bearish momentum, and the dollar remained under pressure amid worries about the US economy and the President's protectionist policy.
Source: Bloomberg Pro Terminal
Jr Trader Petar Milanov
Read more:
25 Canada Square, Level 33, office 50, Canary Wharf London, E14 5LQ +44 20 3608 6256
World Financial Markets - 0700 17 600 Varchev Exchange - 0700 115 44
Varchev Finance Ltd is registered in the FCA (FINANCIAL CONDUCT AUTHORITY) with a passport in the United Kingdom: FCA, United Kingdom - registration number: 494 045, which allows provision of financial services in the United Kingdom.
Varchev Finance Ltd strictly comply with the statutes of the European directive MiFID (Markets in Financial Instruments). targeting increased efficiency, transparency and uniformity of financial instruments.
Varchev Finance Ltd is authorized and regulated by the Financial Supervision Commission - Sofia, Bulgaria: License number RG-03-02-05 / 15.03.2006
The information on this site is not intended for distribution or use by any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
Disclaimer:
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 63,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.