Dow Jones, S&P 500, and Nasdaq weakened as rising treasury yields continue to spook investors

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Dow Jones, S&P 500, and Nasdaq weakened as rising treasury yields continue to spook investors

The U.S. stock market weakened in March’s third trading week, and Wall Street’s three main indexes closed in the red. Rising treasury yields continue to spook investors, and it is important to say that the U.S. 10-year Treasury yield rose to a 14-month high.

The Dow Jones, the S&P 500, and the Nasdaq face a tough road ahead as higher lending rates make speculative equities less attractive, but optimism over the $1.9 trillion COVID-19 relief package still keeps the market in a buy zone. It is also important to mention that the Federal Reserve increased its median projection for inflation last week and reported a decision to end its temporary easing of capital requirements for big banks.


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“The U.S. Federal Reserve said it would not extend a temporary capital buffer relief put in place to ease pandemic-driven stress in the funding market. Banks have had such a significant up move this year, and this news has only acted as a catalyst for profit-taking,” said Art Hogan, chief market strategist at National Securities in New York.

According to analysts, Wall Street’s three main indexes’ upside potential remains limited for now despite the fact that the IMF indicated that there are signs of a stronger global economic recovery.

S&P 500 down -0.77% on a weekly basis

For the week, S&P 500 (SPX) weakened by -0.77% and closed at 3,913 points.

spx
Data source: tradingview.com

If the price jumps above 4,000 resistance, it would be a “buy “signal for the S&P 500, but if the price falls below 3,800 points, it would be a strong “sell” signal, and we have the open way to 3,700 or even 3,600 points.

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DJIA down -0.46% on a weekly basis

The Dow Jones Industrial Average (DJIA) weakened -0.46% for the week and closed at 32,628 points. Wall Street analysts expect an equity pullback in the near-term, but as long the price is above 30,000 points, the Dow Jones Industrial Average index remains in a bull market.

dji 2
Data source: tradingview.com

If the price jumps above 33,000 points, it would be a bullish confirmation for Dow Jones Industrial Average (DJIA). On the other side, if the price falls below 32,000 points, it would be a firm “sell” signal, and the next target could be around 31,500 points.

Nasdaq Composite down -0.79% on a weekly basis

 The Nasdaq Composite (COMP) has lost 0.79% on a weekly basis and closed at 13,215 points.

nasdaq 2
Data source: tradingview.com

If the price jumps again above 13,500 points, it would be a confirmation of the bullish trend, but if the price falls below 13,000 points, it would be a strong “sell” signal, and we have the open way to 12,500 points.

Summary

The U.S. stock market weakened in the third trading week of March, and Wall Street’s three main indexes closed in the red on a weekly basis. Rising treasury yields continue to spook investors, and the upside potential for Wall Street’s three main indexes remains limited for now.