The Stock Market Is Weaker Than It Looks

The Stock Market Is Weaker Than It Looks

The Stock Market Is Weaker Than It Looks - Order Reprints - Print Article While the broader stock market may have rebounded from Monday’s selloff, the rally has masked the pain felt in several sectors. On Monday, the S&P 500 fell 1.6% and, at its lowest, was down was more than 3% below its all-time high. The index has made a swift rebound, now less than 1% below its high, and is far away from correction territory, defined as a 10% drop or more from a recent high. But correction-like movements have been happening beneath the surface. Heading into Wednesday’s trading, 36% of S&P 500 stocks were trading above their 50-day moving averages, down from 91% in April, according to Truist data. That suggests the stock market has been correcting itself for a few months, which isn’t immediately evident by glancing at the S&P 500, writes Keith Lerner, chief market strategist at Truist. Some of the most economically sensitive sectors have been particularly weak, with financials, materials, and energy stocks as prime examples. About 14% of S&P 500 financial stocks …
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