S&P 500: Analysts split on whether 4200 support will hold

Treasury yields continued to rise on Wednesday, with U.S. yields hitting 5.0% for the first time since 2007, while the yield was last seen at 4.82%.

The were mostly flat after the benchmark U.S. stock market index fell 1.4% on Tuesday. European stocks have seen slight gains, with the up 0.2%.

In the FX market, was flat, hovering at around 149, after previously falling to test the 147 handle.

are sharply down, with WTI crude falling 2.1% to trade near $87.50.

As the closed near 4230 on Tuesday, analysts are urging investors to pay close attention to the 4200 handle.

“It’s likely that SPX cash tests its 200 DMA (4202) for the first time since March. The ~4200 level is quite significant for a number of reasons including the 200 DMA, the range breakout in May, and the 38.2% retracement of the October ’22 lows to July ’23 highs (4181),” BTIG analysts wrote in a client note.

“While we could see an initial defense of 4200, we generally find too many eyes are on this level and too many participants are blindly assuming that will be the bottom and we will have a 4Q rally. Unfortunately, we see too much deterioration beneath the surface to support that view.”

Fairlead analysts are more positive as they argue that the S&P 500 is “one step closer to a short-term low” after yesterday’s “emotional trading” session.

“The SPX is now within reach of its 200-day MA (4202) and additional support in the 4180-4195 area. At the same time, we have a 17% reading in the Fear & Greed Index, which sets the stage for a reversal from a contrarian perspective,” they wrote.