US stocks slump amid risk aversion

By FXStreet FXStreet (Córdoba) – Wall Street edged sharply lower on Tuesday, weighed by a sell-off in global equities and a sharp decline in commodities. The DJIA traded almost 300 points lower intraday, although it bounced before the closing bell, ending the day down 179 points or 1.09% a 16,330.47. The Nasdaq and the S&P also closed in the red.

The confusing message from the US Federal Reserve, that kept rates unchanged last week, followed by ultra hawkish comments from different officials this week, vowing for a rate hike as soon as October, have pushed investors into profit taking.

During the upcoming Asian session, China will release its latest Manufacturing PMI which may add to fears about slowing global growth, and therefore trigger another round of sell-offs among worldwide equities.

DJIA technical view

“Technically, the daily chart shows that the index closed at its lowest in two weeks, and below the 50% retracement of its latest weekly decline, also below its 20 SMA. In the same chart, the technical indicators have turned lower with the Momentum still above its 100 level, but the RSI heading south around 44, anticipating a downward continuation”, said Valeria Bednarik, chief analyst at FXStreet. “In the shorter term, the 4 …read more

Source:: FX Street