Another Bearish Session for Stocks

Stocks worldwide plunged on Tuesday and EU indices were trading at this year’s lows, while the US benchmarks dropped closer to October’ lows. The DAX index was down 1.2% during the London session, while the SP500 benchmark lost 1.5% shortly after the US opening bell and the Nasdaq was down another 2% to trade at 7-month lows.

Sentiment worsened further on Tuesday as FAANG stocks continued their demise, which dragged the entire stock market down.

From the macro data point of view, US building permits rose slightly from 1.241 million annually to 1.263 million annually, while housing starts jumped more than 6% from 1.21 million to 1.228 million. The homebuilders sector is one of the worst performing sectors this year amid rising mortgage rates.

US yields followed stocks lower as the risk-off sentiment usually benefits US bonds, which pushes their yields down. The greenback also surged today and the dollar index has managed to defend the bullish trend line for now.

Copper is now trying to breach from the big consolidation triangle to the upside, which could be a positive signal for inflation outlook, but also for cyclical stocks and therefore this commodity should be closely watched over the next days.

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