The key indices of the US stock market - Dow Jones, NASDAQ, and S&P 500 - ended Friday with a not too strong decline, although with such a strong Nonfarm Payrolls report, one could expect growth. However, as we have said more than once, the US stock indices are now in the stage of global correction, so we continue to expect them to fall further. It is worth noting that the current correction levels are already quite strong. It should be remembered that we are talking about securities, which are backed by specific and very real assets, companies, and businesses. The Dow Jones index, for example, has already lost about 10%, the NASDAQ index - by 20%, and the S&P 500 index - by 20%. This bitcoin can theoretically fall in price to 0 and everyone will assume that this is its real value, because bitcoin itself is not secured by anything and has no real value or utility. Theoretically, there may also be a collapse in stocks, but it will be a situation like with oil a couple of years ago when "black gold" fell in value to $ 0 per barrel. It was clear to everyone that this was an "economic cataclysm", oil, which holds the entire production of the world and the entire transport industry, could not cost anything. Therefore, it is unlikely that the US stock market will collapse to zero, nevertheless, we continue to expect it to fall further since the fundamental background does not bode well for it.
In principle, all the factors of the fall in US stock indices remain the same. Already this month, the Fed rate may be raised by 0.5%, and the same decision is likely to be made next month. Thus, in just two months it can grow by 2 times. We have already said that the higher the rate, the more attractive safe assets, such as bank deposits or treasury bonds, look to investors. Now, this mechanism is not even fully working yet, since inflation overrides any profitability of these investment instruments. But inflation in the US will fall, as the Fed firmly takes the position of "tightening monetary policy until inflation returns to the target level," and both investment tools involve investing for at least several years. Therefore, growth stocks could theoretically still grow in price, since they provide the main return due to an increase in their value, but given that the money supply will be reduced thanks to the QT program, this option looks doubtful so far. As a result, now all three indices have shown a correction against the correction and now they may well resume falling.
