S&P 500 is dropping but clings to 4500, as US stocks opened mixed

US equities are trading mixed after Wall Street’s opened two hours ago. The losers are the S&P 500 and the Dow Jones Industrial Average, each losing between 0.15% and 0.49%, sitting at 4537.05 and 34,691.34, respectively. The gainer is the heavy-tech Nasdaq Composite gaining 0.25% at 14,787.13 around 15:33 GMT.

China’s Covid-19 outbreak, Russia - Ukraine woes dampened the market mood

The market risk appetite was affected by “fear” of a deceleration of the Chinese economy once China was hit by an outbreak of the Covid-19 Omicron variant. Also, the Russia – Ukraine conflict peace talks languished as Russia continued its offensive. At the same time, the greenback gains, underpinned by the Federal Reserve, as market participants expect a 50 bps increase in the May meeting by the US central bank, as US Treasuries yields keep advancing.

Aside from this, US equities sector-wise are led by Consumer Discretionary, Real Estate, and Utilities, up 1.25%, 0.73%, and 0.01% each. The main losers are Energy, Materials, and Financials, down 2.65%, 1.41%, and 1.31%, respectively.

The US Dollar Index, a gauge of the greenback’s value, sits at 99.224, up 0.42%, while the 10-year US Treasury yield eased off the highs, down three basis points at 2.462%.

Worth noting that parts of the yield curve inverted, with 5s at 2.636%, while the 30s at 2.600%, at some time during the day, a signal that triggers “recession concerns” in the market participants.

In the commodities complex, the US crude oil benchmark, WTI, is down 4.69%, trading at $107.39 BPD, while gold (XAU/USD) is down 1.05%, exchanging hands at $1936.85 a troy ounce, pressured by buck’s gains.

The US economic docket featured the US Goods Trade Balance for February, which came at $-106.59B better than the $107.57B January’s deficit, while the Dallas Fed Manufacturing for March rose by 8.7, lower than the 11 foreseen, and trailed February’s 14 figure.

Technical levels to watch