As such, and in the main European markets, all major indices closed lower, albeit with moderate declines, with the specific exceptions of the British FTSE 100, which was flat, and the Italian FTSE Mib, which ended the day higher. , which can be interpreted as investors receiving a relatively positive response to the results of this weekend’s legislative elections in the country, in which the right-wing coalition won somewhat comfortably, though being able to amend it The required majority was not obtained. Italian constitution without referendum.
On Wall Street, major indices also tried to rebound during various phases of yesterday’s session, however, in the end, they all closed lower, with the Dow Jones finally entering a bear market, past highs. , reached in early January, thus accompanying the S&P 500, an index that recorded months earlier—it closed at its lowest level since December 2020—.
In this regard, it should be remembered that both the Nasdaq Composite and the Russell 2000 entered a bull market during the month of July and the first half of August during the rally experienced by Western equity markets, despite the sharp declines experienced by Can go Both indices, from their recent highs in mid-August, have yet to enter a bear market again, although they are in a correction phase, having lost over 10% since then.
As we have pointed out in several of our recent remarks, although the underlying trend of the stock markets remains bearish, with investors very concerned about the future of the global economy, we do not rule out that the current High levels of overselling are shown by the major indices and many securities facilitate a rebound in the stock markets which can also be very vertical, although we do not think it will be a “fixed one”.
Thus, in the short term, factors such as i) a potential correction of the dollar, a currency that has acted as a haven for many investors and is overbought, can act as a “trigger” for the above rebound. Is; ii) Announcing the removal of some of the prisons built to “counter” the spread of COVID-19 in China; iii) Better than expected CPI readings for September in the Eurozone; or iv) publication during earnings season, which is due to begin on Wall Street and the main European stock exchanges, the publication of quarterly figures that are better than expected by some benchmark companies in their areas of activity.