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US stock markets are currently under pressure, with market participants awaiting the inflation report due on Wednesday, as well as concerns about the debt limit and regional banking issues in the US. The S&P 500 was trading down by 0.4%, while the Nasdaq and the Dow Jones were both down by 0.5% and 0.4%, respectively.

In premarket trading, shares of PacWest Bancorp (PACW) and Western Alliance (WAL) resumed their slide, causing concerns about the regional banking crisis to resurface. Furthermore, shares of Lucid (LCID) and PayPal (PYPL) were down in premarket trading, with the former reporting a greater-than-expected loss, and the latter cutting its outlook for operating margin.

Investors appear to be leaning towards precious metals as a safe-haven asset, with gold rising by about 0.3% due to concerns over a potential recession, debt limit issues, and banking turmoil. Crude oil fell by about 1% before the New York trading opening, likely due to concerns about lower demand.

Investors are now bracing for the inflation report to gauge the monetary policy path, with the current halt and elevated interest rates. Higher prices could lead to an elongation of the pause period to support the dollar and tighten borrowing to fight inflation, while lower prices could initiate buying into equities, as any slight dovish tone could lift the mood for a bullish bias.

1 Week Ago

The Nasdaq is trading around the Quarter’s highs within a balanced price range, which may initiate selling towards the lower extreme as a rotational scenario, with a currently higher dollar exerting pressure. However, the market might meet some buying interest in the New York trading session, as yesterday’s auction left a balanced price range, leading buyers to lean towards the current tested lower extreme.

Intern calculations point to a mixed session, while the higher volatility may be a warning of a potential upcoming price drop.

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