Risk Warning: CFDs and margin FX are leveraged products that carry a high level of risk to your capital. Trading is not suitable for everyone and may result in you losing substantially more than your initial investment. Please consider our PDS

Market Insight – Is a robust Relief Rally on the cards for S&P 500?

Market Insight – May 11th, 2022.
• Is a robust Relief Rally on the cards for S&P 500?
• Sell-off eased a bit while markets wait for inflation data.

Market Insight – May 11th, 2022.

  • Is a robust Relief Rally on the cards for S&P 500?
  • Sell-off eased a bit while markets waited for inflation data.

S&P 500

S&P 500 tumbled down to touch the 3960 level yesterday to recover back to 4001 points later. The heavy sell-off that got triggered on the 30th of March. It has seen markets struggling to find reasonable support on the chart. High inflation, rising interest rates, the Russia - Ukraine War, and slowing economic growth all contributed to creating fear amongst the investors. The selloff seems to have eased a bit in yesterday’s session. The index touched the 3960 level. And it later climbed back to 4001 points a gain of about 9.81 points or 0.25% at the time of closing. Tech heavy Nasdaq jumped 0.98%, DOW Jones was down by 0.26% and the VIX Volatility index eased a bit too as it dropped down to 32.99 points as investors stay cautious of buying back just as the markets waited for the inflation data today.

Markets have been quite volatile across all asset classes. Because fears prevailed in the markets in anticipation of the slowdown in the global economic growth. Rising inflation and interest rate hike further added to investors' woes. Last week interest rates rose in the Federal Reserve of the USA to 1%, the Bank of England to 1%, and by RBA of Australia to 0.35%.

The annual inflation rate in the US jumped to 8.5% in March 2022 the highest since 1981. The markets are now waiting for the latest CPI report due today. The expectations are that the CPI could drop to 8.1% year over year, a little lower than the march data.

US Inflation chart

To contain the selloff and restore a sense of confidence in the investors the Inflation data to be published today must step down from the 8.5% record high that was witnessed in March. Many analysts expect that the March data marked the peak in inflation but the war in Ukraine is still not over, Interest rates are rising, and supply chain bottlenecks persist that could weigh on the CPI data to be published today.

Click to see Charts of The Week: Charts of the Week - Could Bitcoin recover from the yearly low?

Open a FREE CFD demo trading account

Disclaimer

The information provided is of a general nature and is not intended to be personalised financial advice. The information provided is not intended to be a substitute for professional advice. You may seek appropriate personalised financial advice from a qualified professional to suit your individual circumstances.

Trading in Rockfort Markets derivative products may not be suitable for everyone as derivative products may be considered as high risk. Please ensure that you understand the risks involved. A Product Disclosure Statement can be obtained here and should be considered before trading with us.

Vishal, R.

May 11, 2022

Share on facebook
Share on twitter
Share on linkedin

Related blog posts

Get weekly insights from award-winning team

Sign up for all the latest updates from our Rockfort Academy including news, industry analysis and updates from trading central team.

  * By entering your email, you agree to our Terms of Service and Privacy Policy.

Open a FREE Demo Trading Account

Rockfort Markets’ products are risky; please read our PDS.