Thanks, FAANG stocks and Jerome Powell.
A March rout in once ultra hot tech names such as Action Alerts Plus holdings Facebook (FB) - Get Report and Amazon (AMZN) - Get Report and fears of rising interest rates have the S&P 500 on the brink of a dreaded correction. The S&P 500 tanked 55 points, or 2%, on Monday to 2,586. That brings the benchmark index down a shade over 10% from its record closing high achieved on Jan. 26.
The Nasdaq Composite hit a 10% correction from its highs midday Monday, primarily on the sentiment shift on FAANG stocks.
Despite the pullback, many on Wall Street continue to be optimistic on the S&P 500 this year.
"We expected a more volatile year for U.S. equities, a key reason we prefer quality, but think the bull market has room to run amid a supportive economic and corporate profits backdrop (S&P 500 year-end target = 3000)," says BofA strategist Savita Subramanian. Spurring some of Subramanian's optimism is that inflows into stocks continue to be healthy and stocks aren't that expensive relative to bonds.
Added Analysis Here
Why Monday's session is worrisome...