Wall Street is expected to usher in a technical rebound after the crash. However, this rebound may not appear this week. After the U.S. stock market hit the worst performance during the year last week, the S&P 500 Index has fallen for the sixth consecutive trading day. The index lost 4.3% last week, falling below the 1,300 points mark for the first time over the past 4 months.
Company earnings release season is coming to an end, and the U.S. economic data deepen the investor suspicion on economic growth. The S&P 500 index has dropped 7.3% in May, and the index may continue to fall this week as the European debt problems.
This week, what still weigh on the investor sentiment will be the European debt crisis which is close to new heights, investors are concerned about the Greece’s quit of the euro zone and the health of the Spanish banking system.
Although strong corporate earnings and better-than-expected have enhanced the power of the U.S. stock market, and offset the adverse effects by the European debt crisis. Earnings results and economic data are expected to start to disappoint the market this week, investors will transfer their eyes to Europe.
G8 leaders met last week met to discuss the financial crisis in Europe. G8 leaders urged European leaders to do more to promote growth.
Analysis pointed out that the U.S. stock market has been extremely oversold. Nevertheless, all indicators are showing sell signals and a strong but short-term rebound is expected to appear soon.
The highly focused Facebook IPO has been successfully finished. Investors will continue to focus on its follow-up performance.