After trading with mixed sentiment for two weeks, the S&P 500 (SPY) started this week on a weaker note and declined as the week progressed. The S&P 500 started Wednesday on a mixed note, lost strength in the afternoon session, and closed the day lower.
The market sentiment was stable in the morning session amid the release of stronger-than-expected jobs data. According to ADP, the US ADP non-farm employment change in April was 204,000—better than the forecast of 200,000. However, the market lost strength and traded lower following the FOMC’s statement in the afternoon session. The decreased risk appetite amid speculations that the Fed might increase the interest rates four times in 2018 weighed on the market. The Fed left the interest rates unchanged on Wednesday. The Fed announced that inflation has reached the target of 2%. The Fed also added that the interest rates are expected to increase gradually.
The CBOE Volatility Index (or VIX) measures uncertainty in the market. The index gained 3.1% to 15.97 on May 2. The index is measured on a scale of one to 100 with 20 as the historical average. The VIX is also called the “fear index.” Usually, the index has an inverse relationship with stocks and rises when the S&P 500 falls.
NASDAQ and Dow
The NASDAQ Composite Index (QQQ) and the Dow Jones Industrial Average (DIA) started May 2 on a mixed note and lost strength in the last hours of trading. Despite the IT sector’s stable performance on Wednesday, the tech-heavy NASDAQ Composite Index lost strength amid the weak market sentiment. The NASDAQ Composite Index declined 0.42% and closed the day at 7,100.90. The Dow Jones Industrial Average declined 0.72% and closed the day at 23,924.98.
Next, we’ll discuss how the S&P 500’s top gainers performed on May 2.