The S&P 500 dropped by 1.08% today while the Dow declined by 1.51%. The decline of the stock market came as the Coronavirus cases in the US inches towards 3 million. As more states are rolling back their reopening measures, investors are wondering if the optimism in the market is truly justified by the economic recovery which remains rocky.
Today’s market decline has also ended the recent streak of rallies and signals that the market might have had enough risks. The recent rally in the stock market has left many investors wondering if stocks are overvalued. However, before the surge of new Coronavirus cases, the promise of a speedy recovery lifted investor’s optimism. As the US struggles to combat the new infections, we are seeing a decline in investor confidence.
FANG Stocks
After the strong rally yesterday, FANG stocks posted mixed performances today, with Facebook (FB) up 0.24%, Amazon (AMZN) down 1.86%, Netflix (NFLX) down 0.13%, and Google (GOOGL) down 0.65%. FANG stocks have been leading the stock market recovery with impressive gains in the second quarter. However, as the evaluation of FANG stocks continues to climb, investors begin to question whether the optimism is justified by the actual business outlooks.
Bitcoin Price
After nearing $9,400, Bitcoin price today dropped back to its recent level of $9,200 apiece. Given the recent rally to $9,400, the new support level for BTCUSD has been updated to $9,200. The prospect of Bitcoin to breaking out above $10,000 remains challenging in the short-term.
Commodities and Treasuries
Commodities wise, crude oil futures decline modestly by 0.34% today. On the other hand, natural gas future was up an impressive 2.73%. As investors are unloading risks, precious metals rallied modestly today with gold up 0.78% and silver up 0.18%. Natural gas future was up 3.29%. Treasuries had modest gains across the curve as investors are looking to reduce risk positions. 30-year treasury bond’s yield tightened to 1.375%, while 10-year treasury’s yield tightened to 0.646%.
