There are several potential reasons why the US stock market experienced a selloff in April 2024 after a strong first quarter:
1. Interest rate concerns: If the Federal Reserve signaled that it might raise interest rates more aggressively to combat inflation, it could lead to a market selloff.
2. Geopolitical tensions: Escalating geopolitical tensions, such as increased conflict between nations or new trade disputes, could rattle investor confidence and lead to a risk-off sentiment in the markets.
3. Valuation concerns: After a strong rally in the first quarter, some investors might have become concerned that stock valuations were getting stretched.
4. Economic data: Weak economic indicators, such as a slowdown in GDP growth, rising unemployment, or a decrease in consumer spending.
5. Technical factors: Technical analysis factors, such as key support levels being broken or negative chart patterns emerging, could exacerbate a market selloff as traders and investors react to these signals.
The information contained in this Higgins Capital communication is provided for information purposes and is not a solicitation or offer to buy or sell any securities or related financial instruments in any jurisdiction. Past performance does not guarantee future results.