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George Ma
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Stocks
April 27 11:45

Bank of America: S&P 500 may fall drop further in coming months

Decline happened mainly because of COVID-19 outbreak
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S&P 500 lost more than 30% in March within a few trading days. Decline happened mainly because of COVID-19 outbreak and its impact on American and world economy. Index has since managed to regain its losses and acquired over 500 basis points.

However, BoA analysts are certain that S&P 500 may drop to new lows if the current volatility stands.
Volatility problems for the S&P 500
BoA analysts are certain that S&P 500 could drop further if volatility remains. This is evdent from the recent report.
Experts expressed the view that the index tracks the bear market rally of 2008-09 since its peak on 16th of March. Data tells that in the last bearish cycles (1987, 2002 and 2008), the index rallied from its peak to the bottom for 1.5 to 4 months. During this period, S&P 500 went up from 15% to 25% before dropping again.
If this pattern is correct, S&P must see their current peak around 2960 before it falls below its low point from middle of March.
Things are not going very well for firms included in the index. In the last 24 hrs, almost every single share that is included in S&P 500 was traded with a loss, while some - Google, Facebook and Microsoft have seen a falling of about 4%.