Stocks are wavering Friday to wrap up what has been a stellar week for the market.
The S&P 500 was flat at the open, and the tech-heavy Nasdaq Composite was up 0.1%. Both indexes have risen each day this week, the longest winning streak since late July. The Dow was down 72 points, or 0.2%, after ending at an all-time high yesterday.
Bond prices are on the decline, with both the 10-year and 30-year Treasury yields higher by 0.03 percentage point each. When yields are higher it means prices of these Treasuries have fallen–a reversal from the two-day trend of rising bond prices.
“Well, the market can’t go up every day,” wrote Bespoke Investment Group. “Following yesterday’s rally, the S&P 500 has now moved into ‘extreme’ overbought territory on a short-term basis, which we define as more than two standard deviations above its 50-day moving average (DMA). The last time it traded at more overbought levels was back in June 2023,” the firm added. In plain english it means, the index’s price has risen too quickly and too high, and the risk of a decline has increased.
That means a pullback today would be a good sign–investors likely see that the market has been stretched too far and are taking some profits off the table.
In commodities, both gold and oil were higher, a reversal from the move lower yesterday. Fundamentally, gold can keep getting bid higher on geopolitical flare-ups that have shown no signs of dissipating. President Donald Trump on Friday said his patience with Russian President Vladimir Putin was ‘sort of running out and running out fast.’ Russian drones’ incursion over Poland has escalated tensions.
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