Dow Jones tumbles as banking crisis erupts.
“Banking crisis in the US prompts risk aversion, with immense selloff among financial services stocks in the country.”
US equities ended the lower on yesterday, spurred by rising concern over banking turmoil in the United States. Following the collapse of Silicon Valley Bank and Signature Bank, the US government and Federal Reserve stepped in to rescue the banks while agreeing to backstop all depositors. In addition, the Fed launched a new funding program which will offer loans with maturities up to a year in order to increase liquidity among banks in case of deposit outflows. The sentiment tarnished investors risk appetite, shifting their focus from risky asset such as equities into safe havens.
Technical Analysis
DJI, Daily: Dow Jones index tumbles further, closing below 200-MA line for the first time since last November. While overall trend direction is skewed towards bearish, we would suggest to wait for a close below the nearest support before entering the market.
Resistance level: 32825, 34120
Support level: 31560, 30260
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