By IFCMarkets
Government assistance supported stock markets
As a rule, the high-tech Nasdaq100 index possesses increased volatility and is the first to respond to news. Earlier, the largest international banks announced very pessimistic forecasts of a decline in the US GDP, which were taken into account in stock prices. In particular, JPMorgan Bank expects the US economic downturn in the 1st quarter up to 10.5% in annual terms and another 25% in the 2nd quarter. The amount of government assistance of $ 2 trillion is just about 10-11% of the annual US GDP and can help corporations survive the crisis caused by the coronavirus epidemic. Theoretically, the 2nd quarter for the US economy may not be as bad as previously expected. An additional positive factor may be a decrease in world oil prices. The value of West Texas Intermediate (WTI) dropped to $ 20 per barrel, the lowest since 2002. This will help reduce the costs of the American economy. Another good factor is the Fed’s policy of lowering rates and an almost unlimited supply of liquidity. US GDP data for the 1st quarter will be released only at the end of April. Non-farm Payrolls employment rate for March, which may affect the dynamics of the Nd100, will be published this Friday.
| Indicator | VALUE | Signal |
|---|---|---|
| RSI | Buy | |
| MACD | Buy | |
| MA(200) | Neutral | |
| Fractals | Neutral | |
| Parabolic SAR | Buy | |
| Bollinger Bands | Neutral |
| Order | Buy |
| Buy stop | Above 7910 |
| Stop loss | Below 6610 |
Market Analysis provided by IFCMarkets