Stock Market News

Post election run leaves S&P 500 vulnerable: Wells Fargo

2024.12.24 06:31

Post election run leaves S&P 500 vulnerable: Wells Fargo

Investing.com — Despite the decline last week, the experienced a notable post-election rally, largely driven by gains in technology-related companies. 

However, analysts at Wells Fargo (NYSE:) caution that beneath this surface-level optimism, the market may be vulnerable to a pullback.

Through December 17, the S&P 500 posted a modest gain of 0.38% month-to-date, in contrast to declines in other major indices. 

The dropped 3.12%, and the small-cap fell 4.06% during the same period. 

Wells Fargo attributes this divergence to weakening economic surprises, as measured by the Bloomberg U.S. Economic Surprise Index. 

The index, which gauges how economic data compares to consensus expectations, has trended downward since peaking in mid-November, now hovering just above zero.

“This is concerning,” Wells Fargo notes, “given the level of positive positioning that has taken place in equity markets since the elections.” 

They explain that investors appear overly focused on a potentially brighter future while ignoring the current disappointing data. 

Wells Fargo warns that this disconnect may soon need resolution.

Historically, markets can experience post-inauguration disillusionment as high expectations collide with the realities of policymaking, says the bank. 

With the S&P 500 nearing overbought territory, Wells Fargo advises investors to remain disciplined and ensure equity allocations align with recommended levels. 

“We think now would be a good time for disciplined investors to make sure that their portfolio allocations to equities are not above recommended allocations, especially with long-term interest rates offering a solid alternative,” the firm adds.

Despite the concerns, technical indicators show the S&P 500 remains in an uptrend. Wells Fargo highlights key support levels at the 50-day moving average (5920) and the 200-day moving average (5515), with resistance at the recent high of 6090.

Wells Fargo advises caution, concluding: the “post-election run leaves S&P vulnerable.”



Source link

Related Articles

Back to top button
bitcoin
Bitcoin (BTC) $ 98,555.41 4.41%
ethereum
Ethereum (ETH) $ 3,486.78 2.20%
tether
Tether (USDT) $ 0.998807 0.08%
xrp
XRP (XRP) $ 2.31 2.92%
bnb
BNB (BNB) $ 697.75 1.16%
solana
Solana (SOL) $ 196.98 3.92%
dogecoin
Dogecoin (DOGE) $ 0.337354 4.69%
usd-coin
USDC (USDC) $ 0.999653 0.14%
staked-ether
Lido Staked Ether (STETH) $ 3,481.79 2.40%
cardano
Cardano (ADA) $ 0.935736 2.08%
tron
TRON (TRX) $ 0.255685 1.39%
avalanche-2
Avalanche (AVAX) $ 41.05 5.96%
chainlink
Chainlink (LINK) $ 25.16 3.71%
the-open-network
Toncoin (TON) $ 5.87 5.00%
wrapped-steth
Wrapped stETH (WSTETH) $ 4,140.99 2.49%
shiba-inu
Shiba Inu (SHIB) $ 0.000024 6.37%
sui
Sui (SUI) $ 4.60 2.29%
wrapped-bitcoin
Wrapped Bitcoin (WBTC) $ 98,071.28 4.08%
hedera-hashgraph
Hedera (HBAR) $ 0.324078 10.32%
stellar
Stellar (XLM) $ 0.397771 8.18%
polkadot
Polkadot (DOT) $ 7.53 3.23%
hyperliquid
Hyperliquid (HYPE) $ 30.06 6.87%
weth
WETH (WETH) $ 3,486.02 2.20%
bitcoin-cash
Bitcoin Cash (BCH) $ 467.48 2.53%
leo-token
LEO Token (LEO) $ 9.50 1.58%
uniswap
Uniswap (UNI) $ 14.46 2.11%
litecoin
Litecoin (LTC) $ 108.07 1.98%
pepe
Pepe (PEPE) $ 0.000019 4.85%
bitget-token
Bitget Token (BGB) $ 5.04 19.34%
near
NEAR Protocol (NEAR) $ 5.55 3.16%
wrapped-eeth
Wrapped eETH (WEETH) $ 3,679.73 2.37%
ethena-usde
Ethena USDe (USDE) $ 0.998708 0.05%
aave
Aave (AAVE) $ 371.61 3.30%
aptos
Aptos (APT) $ 9.77 2.43%
internet-computer
Internet Computer (ICP) $ 11.33 6.25%
usds
USDS (USDS) $ 0.999246 0.21%
crypto-com-chain
Cronos (CRO) $ 0.163649 2.08%
polygon-ecosystem-token
POL (ex-MATIC) (POL) $ 0.525369 5.08%
vechain
VeChain (VET) $ 0.052623 9.51%
ethereum-classic
Ethereum Classic (ETC) $ 27.82 1.69%
mantle
Mantle (MNT) $ 1.23 3.19%
render-token
Render (RENDER) $ 7.79 2.31%
bittensor
Bittensor (TAO) $ 502.46 4.52%
fetch-ai
Artificial Superintelligence Alliance (FET) $ 1.39 2.27%
mantra-dao
MANTRA (OM) $ 3.80 0.89%
whitebit
WhiteBIT Coin (WBT) $ 24.92 2.35%
monero
Monero (XMR) $ 191.28 0.83%
arbitrum
Arbitrum (ARB) $ 0.815313 2.51%
dai
Dai (DAI) $ 1.00 0.10%
filecoin
Filecoin (FIL) $ 5.44 5.95%