The market staged a big midday reversal, with falling bond yields giving a boost to growth stocks, and ahead of a slew of economic data.
The futures tied to the industrial average were not moving. The S-P 500 futures were not changed.
The losses in regular trading were trimmed as the holiday shortened week began. The S&P 500 recovered from a 2% loss in the last hour of trading to finish the day up 2%. The tech-laden index jumped 175%.
The benchmark 10-year U.S. Treasury yield fell below the 2-year yield. The yield curve is a sign that the economy may be falling.
The price of oil fell below $100 a barrel on Tuesday. The top decliners were energy companies. The entire sector fell. It was the worst performing sector in the S&P 500 for the first half of the year.
Wall Street analysts think that a recession is not likely. Credit Suisse lowered its year-end S&P 500 target to reflect the effect of higher capital cost on stock valuations.
The market has been anticipating a recession, and now it may be embracing it, the idea being, let's just get it over with, we're going have a recession, let's do it. Ed Yardeni of Yardeni Research spoke on CNBC's "Closing Bell: Overtime."
He said that the market is starting to look ahead into next year and that could be a recovery year from the recession. To be or not to be is what we are doing. There is a chance that there will be a mild recession.
NewEdge Wealth's chief investment officer was also in agreement with that sentiment.
She asked if we have a kind of drawdown that looks to be in that 30% range, which is the average for recessions, or something that looks closer to down 50%, which is what we saw in the early 2000s and 2008 where we had two debt crises. There isn't a debt crisis. We think that we can find some value around the 3,400-3,500 level.
There will be a lot of economic reports coming out on Wednesday, including the minutes of the Federal Reserve's June meeting.
The Mortgage Bankers Association's mortgage purchase index is due to be read at 7 a.m. The time is Wednesday The data will be released at 10:00 a.m. The job openings and labor turnover survey will be released at 10:00 a.m.
All Rights Reserved © 2024
