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Askyolo Tech:US stock market rebounds

2022-08-12 13:57:00

Askyolo Tech:US stock market rebounds

According to askyolo tech,The rebound of the US stock market in recent weeks is causing Wall Street analysts and investors to question whether the deep decline of the stock market in 2022 has ended. But not all wall street people can reach an agreement on how to judge whether the bear market is coming to an end or a new bull market has begun.

US equities have risen in the past month or so due to better than expected corporate profits and optimistic bets on peak inflation. With the sharp rise on Wednesday, the NASDAQ index rose 20% from the low of nearly two years hit on June 16, and the standard & Poor's 500 index also rebounded sharply in recent weeks, up 15% from the low in June.

After the recent continuous rise, analysts of bespoke Investment Group announced on Thursday morning that the NASDAQ index had come out of the recent bear market. Although the index is still down about 21% from its record high in November last year, trillions of dollars of market value have evaporated during this period.

錢, 鈔票, 歐元, 鈔票

Is it a cow or a bear?

On Wall Street, the terms "bull market" and "bear market" are often used to describe the general upward or downward trend of asset prices.

It is generally believed that these two indexes are bear markets in 2022, but not all analysts have the same definition of bull market or bear market, and many investors do not strictly use these two terms.

Bespoke wrote in the research report, "we can explain the definition of bull market and bear market for several hours." According to the report, a new bull market started on June 16.

Merriam Webster's Dictionary simply defines a bull market as "a market in which securities or commodities continue to appreciate".

Some investors will more specifically define a bear market as a stock or index falling by at least 20% from the previous peak, while this peak is defined as the beginning of a bear market. A bear market will only be confirmed after falling by at least 20%.

Similarly, they also defined the bull market as 20% higher than the previous low. Bespoke used this standard, and the Nasdaq composite index can now be regarded as opening a new bull market.

The US Securities and Exchange Commission (SEC) defines on its website that "generally speaking, a bull market occurs when the market index rises by more than 20% in at least two months."

However, the index provider that manages the standard & Poor's 500 index and the Dow Jones Industrial Average has a more subtle definition of bull market.

If the index falls more than 20% from the high and rises 20% from the low, the index will still be lower than the previous high. Howard Silverblatt, a senior index analyst at S & P and Dow Jones, described the situation as "a bull rally in a bear market".

圖表,圖形,財務,財務,數據

It's pointless to argue only about cows and bears

Of course, analysts also generally warn that people should not rely too much on the definition of the market cycle by the bull market and the bear market, which is hardly helpful to grasp the current mood or predict the future trend of the stock market.

In fact, according to the data of standard & Poor's Dow Jones index, investors can only confirm that they have entered a new bull market when they reach a new record high. At that time, the previous low will mark the end of the bear market and the beginning of a new bull market.

For example, in the bear market triggered by the financial crisis in 2008, the standard & Poor's 500 index rebounded more than 20% from the low point in November 2008, which ignited the hope of ending the stock market crash. However, the S & P 500 index fell again by 28% in March 2009 and fell to a lower level. It was not until March 2013, when it reached a record high again, that investors were sure that a new round of bull market was born as early as four years ago.

Silverblatt said, "only after the dust settles can we look back and say, 'well, when did the market hit the bottom? That was when the bear market ended and the bull market began."

At present, many people in the industry still have great differences in the trend of the US stock market. David Kelly, chief global strategist at JPMorgan asset management, said that this is a firm market. He said that with the signs of cooling in the economy, the stock market may rebound to a record high in the next few years.

"It will take some time for the inflation rate to drop to 2%, but as long as we make progress in this direction, there is no need to let the economy fall into recession," Kelly said. "If there is such a period when inflation is slowly falling and the economy is slowly moving forward, but the profit rate can be maintained, I think the prospects of the stock market will be quite good."

However, the chief strategist of principal global investors is relatively pessimistic. "The market underestimated the risk, and US Federal Reserve Chairman Powell will eventually show off his heavy weapons. I do not believe that this round of rebound is sustainable. During the whole summer months, we remained neutral to the US stock market because we were worried that it was just a bear market rebound."

Askyolo tech is an internationally renowned financial trading service provider, specializing in providing a wide range of financial derivatives transactions for retail customers and financial institutions, including foreign exchange, stocks, indices, futures and cryptocurrencies.

Askyolo tech is a global multi product online trading service provider oriented by technical services. It has representative offices or service centers in Australia, Spain, Malaysia, Seychelles, Canada and Cyprus.

Askyolo tech provides multilingual professional services to more than 130 countries and regions in Oceania, Europe, Asia, Africa and North America, and provides traders with more than 200 foreign exchange, precious metals, commodities, indices, stocks and cryptocurrency products.

With the sincere and consistent service concept, askyolo tech provides traders with better market quotation and transaction execution.

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