Zhitong Finance APP learned that Bank of America said that this stock market rebound echoed the bear market trend at the beginning of the Great Depression.
strategist Michael Hartnett believes that since 1929, the S&P 500 index has increased by more than 10% in 43 bear market rebounds, an average increase of 17.2% in 39 trading days and a 17.4% increase in 41 days. This is a "textbook-style" case. The bear market is always small, and in this case, the 30% increase in the S&P 500 is attributed to only four stocks: Amazon (AMZN.US), Apple (AAPL.US), Microsoft (MSFT.US) and Tesla (TSLA.US).
Hartnett said U.S. stocks account for 86% of global stock market gains. Among them, winners are growth sectors and bond agents, and losers are energy and materials sectors, "because investors trade at 'peak of inflation' and 'peak of yields'". However, the risk that bulls need to pay attention to is that the Fed rate hike is far from over.
Hartnett also pointed out that the actual interest rate is still seriously negative, and the tightening of the Federal Reserve is very weak at present. For example, the Federal Reserve purchased a total of US$5 trillion in bonds during the epidemic, and currently only sold US$2 trillion. However, judging from the current retail sentiment and the rebound of Meme stocks, many investors seem to forget that the Federal Reserve still has a long way to go on the road to hiking interest rates.
In addition, from historical experience, the Federal Reserve ended the interest rate hike cycle with the actual negative interest rate in 1954. Therefore, even if the increase in CPI is halfway in the next six months, the inflation rate will still be as high as 5-6% in the following spring.
