Over the past week was big in business news since there were key tech earnings, FED meeting, consumer confidence report and GDP. Overall the news wasn’t that good for the sign of the economy and yet the unexpected happened in the market. Most stocks were up and had very very high gains. Just a month ago everyone was fearing how a recession was imminent and get ready when the FED raised interest rates at a historic level and here we are again with more bitter news.
Not to be a doomer but I still see the market to be relatively bearish. I don’t know how a recession would pan out today vs the one two years ago or in 2008 but the sentiment now seems to be everything is priced in and is not as bad as we thought it might would. Do I know exactly how it will pan out? No I don’t but it’s the fact the sentiment changed that quickly in matter of less than a month. The next big set of news coming is up the inflation report (CPI) August 10th for July. If inflation is still remaining high at 9% it could mean more interest rate hikes by taking more drastic measures. Point being there’s still a lot of macro effects (inflation, highest debt, rising unemployment, loans, etc…) that the economy still isn’t strong. Lastly during Bearish/recessionisk times, there are some of the highest gains in the stock market (dead cat bounces) and that doesn’t necessarily mean you should FOMO (Fear of Missing Out) in because it went up significantly over a short period.
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