Morning all.
“We’ll revisit the 2,200 S&P low, if not make a lower low — probably by late summer,” he said. “That’s going to come because we’re going to find out now is a critical time for the market.”
Interested to know how others are looking at the current rally. Are we back in a sustainable bull market or is this going to run out of steam and collapse?
James Bianco is not the only bear on the street, a few others like Mark Mobius(Mobius Capital), Jeff Gundlach(DoubleLine) and Tony Dywer(Canaccord) are also voicing strong bear cases.
Currently we have a situation where the markets are the economy are not showing any correlation to each other. Just yesterday the US reported it’s worst Q1 print since the great financial crisis.
“GDP in the first quarter contracted 4.8%, compared to estimates of a 3.5% drop, the Bureau of Economic Analysis reported Wednesday.” ~CNBC
Markets continued to rally on this news which was only a taster for an even more terrible Q2. Later in the day, FED Chairmain Jay Powell even appeared to try and talk down the market with his warnings about how bad things are.
“The ongoing public health crisis will weigh heavily on economic activity, employment, and inflation in the near term, and poses considerable risks to the economic outlook over the medium term.” ~ FED chair, Jay Powell.
But once again markets loved this pessimistic outlook as assurance more support will become for longer than might have been expected by some.
If some of this ‘considerable risk’ starts to manifest, and I’d say 26 million jobless claims is already a sign of this, do the markets need to pause for a reality check?
It’s interesting that markets have just reached this bounce-back peak as wer arrive at the end of April, and the popular adage “Sell in May and go away” will pop-up in financial/social media conversations.
Stay safe, thanks in advance for any opinions shared.
$SPX500 $NSDQ100 $DJ30
