Uncertainty in the EU, Rattles US Stock Market
$DIA, SPY, $QQQ, $VXX
- Simply put, Italy has fallen out of love with the Euro!
Italy has been unable to assemble a coalition government since inconclusive elections in March, which saw the rise of anti-establishment parties that support leaving the single currency bloc. The most recent nominee for PM failed to secure support from the country’s major political parties.
Political worries after Italy’s President blocked formation of euro-skeptic government, the action may prompt a de facto referendum vote on Italy’s membership in the EU.
Simply put, Italy has fallen out of love with the Euro!
The political crisis in Rome, and the threat to the fragile Euro project it represents, triggered a rush to traditional safe havens like US debt, pulling down US 10-yr T-Note yield and in turn spurring losses for US banks.
US Treasuries Yield Check
- 2-yr: -16 bpts to 2.32%
- 5-yr: -18 bpts to 2.58%
- 10-yr: -16 bpts to 2.77%
- 30-yr: -12 bpts to 2.97%
Shares of S&P 500 banks registered their biggest 1-day decliner in more than 2 months, ending 4%+ lower.
There is little connection between the Italian government and the S&P 500, but it reminds people of geo-political uncertainty, especially in the Eurozone.
Tuesday, the major US stock market indexes finished at: DJIA -391.64 at 24361.45, NAS Comp -37.26 at 7396.59, S&P 500 -31.47 at 2689.86
Volume: Trade on the NYSE came in at 942-M/shares exchanged.
Declining issues outnumbered advancing ones on the NYSE by a 1.49-to-1 ratio, NAS Comp, a 1.63-to-1 ratio favored decliners.
- NAS Comp +7.1% YTD
- Russell 2000 +5.7% YTD
- S&P 500 +0.6% YTD
- DJIA -1.5% YTD
HeffX-LTN’s US Major Stock Market Indexes Technical Analysis