Monday, 24 August 2015

Will This Sell-Off Continue?

The U.S. stock market is plummeting on China’s growth concerns. There are factors in play other than China also, think overpriced earnings. S&P 500 seems overpriced, and technical indicators show no sign of reversal just yet. The stock market has been in a rut for past few weeks now; it's getting a harder hit today as NASDAQ composite is down 2.5% and S&P 500 is down around 2.3%. The blame of the recent bearish market fell on China's slowing growth, crowded emerging markets and FED's plan to raise interest rates. However, interest rates are on their historical lows; unemployment stays at the ground and corporate profit margin are touching the roof. China, alone, can't be blamed for the sell-off. Sure, the slump in the Chinese market acted as a trigger for the global downward trend. But, this is not the only reason for the current market decline.