The markets have recently experienced wild swings from euphoric highs to depressing lows. However the economic fundamentals have not changed at all.
With 8.2% inflation in September, rising interest rates, there is a global slow down in economy. Companies like Microsoft, Tesla, Meta Platforms are cutting back on staff hiring and retrenching in some cases.
Jamie Dimon, CEO of JP Morgan calls it an "economic hurricane". Just recently, Jeff Bezos said "to batten down hatches".
Can US stocks rest easy? I don't think so as I believe it is a Bear Market rally.
Until the Feds can see a clear sign that inflation is trending down, they will continue their aggressive stance on raising interest rates. High interest rates have a negative impact on stocks as it will raise the cost of borrowing for companies.
Then there is the strong US dollar which impact companies like Apple and Microsoft as their products are sold globally.
The Ukrainian war is still ongoing and this has caused energy prices to rise. All these translate into higher costs for everyone.
Now is not the time for US stocks to rest easy but instead "to batten down the hatches".
Let's fasten our seat belts for the wild roller coaster ride ahead in the markets. Nonetheless in every market, there is opportunity to make money. Every Bear Market will end with the return of the Bull. 🌈🌈🌈🚀🚀🚀🌛🌛🌛💰💰💰🍀🍀🍀
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