Tech Surge Lifts Stocks Back Into the Green
Comment of the Day

July 20 2022

Commentary by Eoin Treacy

Tech Surge Lifts Stocks Back Into the Green

This article from Bloomberg may be of interest to subscribers. Here is a section:

Stocks are advancing for a third day in four amid optimism over the earnings season and growing speculation markets may have bottomed out. While that debate continues, with Sanford C. Bernstein strategists saying markets have yet to see full capitulation, rates markets have discarded bets the Federal Reserve will hike rates by a full percentage point next week, bolstering optimism the central bank will take a more measured approach to policy tightening.

“The fact that companies are showing a certain resilience to the current environment is reassuring market operators who have now started betting on a less aggressive monetary tightening than initially expected,” said Pierre Veyret, a technical analyst at ActivTrades. “Even if we’re not out of the woods yet, more and more traders now tend to believe the worst is behind for equity markets this year.”

Eoin Treacy's view

Recession fear is now a consensus among investors. Therefore it is reasonable to question how the market can continue to rebound. Netflix is a good example to examine. The share collapsed because subscriber growth was unrealizable. The share rebounded this week because its loss of million subscribers was less bad than had been priced in.

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