Despite better University of Michigan, stocks move to new session lows and yields go up | Forexlive
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Despite stronger-than-expected University of Michigan sentiment data, stocks have slid to new session lows while yields have climbed to new session highs. Notably, U.S. bonds appear to be decoupling from the typical flight-to-safety flows often observed during periods of geopolitical tension.
The NASDAQ index is under pressure and edging closer to its rising 100-hour moving average, currently at 19,349.45. The recent low touched 19,425.68, with the index last trading at 19,431—down 231.2 points or 1.18% on the day.
Nasdaq index is lower
The S&P index remains a fair distance above its rising 100-hour moving average, currently at 5953.64. So far today, the index has reached a low of 5983.83 and is last trading at 5986.81, down 0.96% on the session.
In the currency markets, the USD initially climbed in a typical Pavlovian response to geopolitical tensions but has since reversed lower during the U.S. session. The EURUSD is now trading at 1.1538, rebounding from a session low near 1.1488. The pair briefly dipped below the high from June 5 at 1.14935, and approached its rising 100-hour moving average, currently at 1.14775, before bouncing back.
The USDJPY is off its high at 144.48 and looks to test its 200 hour moving average at 144.048.
USDJPY technicals
While market conditions are not signaling alarm, the major stock indices are pulling back from recent corrective highs—making a move lower appear technically normal. However, the stronger-than-expected University of Michigan sentiment data failed to spark any meaningful rebound, raising some concerns.
Although yields are higher and there is no flight to safety decline in yields, they still are below last week’s benchmark levels—4% for the 2-year, 4.5% for the 10-year, and 5% for the 30-year. Some of the current market reactions to conflict seem atypical.
This may reflect broader investor unease, potentially driven by the Trump administration’s ongoing policy flip-flops and its struggle to secure consistent, constructive engagement from key adversaries.
- Although China came to an agreement, it was getting back to what was agreed a month ago in Geneva
- Russia remains a problem child
- Now negotiations with Iran have failed to avoid a reaction from Isreal.
Add the fact that since Saudi Arabia, when more deals were promised, there really has not been anything new. The clock is ticking on deals and tariffs, and the next step seems to be letters that go out, demanding deals, “or else”.
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