Global Equities Pressured By Hawkish Perspective: Market Update

The global equities sector got under pressure as the E-mini S&P 500 fell by about 1.8%, Nasdaq dropped by 2.3% and the Dow Jones is 1.5% in the red as investors are concerned about the hawkish comments by Fed policymakers and worries about a recession. The likelihood of an interest rate hike of about 75bps in the next FOMC meeting might be higher now. High-performing technology stocks got under pressure with Microsoft, Amazon, Alphabet, Facebook, Tesla, and Apple as well. Traders seemingly looking forwards to the Fed Chair Jerome Powell’s speech at the central bank’s annual Jackson Hole economic symposium to conclude further scenarios on the U.S economic front.

However, the recent COT reports shows that Asset Managers and Institutional traders were short covering about 57.512 contracts of CME:ES Futures while new long positions of about 23.084 were opened. The total net positions increased to the buying side, giving the market a potential bullish touch for the upcoming week.

Net hold long postions rises while shorts decreasing

Looking at the current macro perspective on a monthly interval we can see sellers around the Year’s developing VWAP which are pressured with the mentioned economic concerns. The hourly interval heading lower towards the mean of the previous distribution or balanced price range which might serve as a supportive level for buyers, depending on the auction around it. Meanwhile, the dollar index surged about 0.6% with the yield up about 1.3%, hitting the 3% level by the hawkish perspective which may pressure the commodities sector such as Gold (-0.7%).

Mean of prior balanced price range might be supportive for buyers.

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