Last week, the increase in interest rates negatively impacted equity prices as the markets experienced their largest declines since February. The S&P 500 Index fell 4% for the week and broke key resistance levels by breaking below the 200-day moving average of 2,767.
This week, I expect the pressure to continue as the market grapples with the likelihood of the Federal Reserve (Fed) continuing to push interest rates higher. On Wednesday, the Federal Open Market Committee releases the minutes from its September meeting, and I expect the Fed will signal another rate increase at the December meeting. Geopolitical events, including Brexit and the tension with Saudi Arabia, have the potential to put additional downward pressure on the market.
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