and fears rates will stay higher for longer have reignited recession talk. Indeed, some analysts are comparing 2023 to 1987, when stocks were in rally mode even as bond yields spiked. Worrisome bond market signals could only be ignored for so long, with stocks eventually crashing on Black Monday in October 1987.
Still, the uptrend is intact, with the S&P 500 above its 200-day average. Wall Street’s fear index, the Vix, has spiked but remains at historically normal levels.Budget 2024: Giveaway package to see big spending increases and tax cuts for middle-income earners Corrective episodes are perfectly normal, and two consecutive monthly declines after a five-month winning streak is hardly indicative of a looming crash. Weakness is not only normal but “likely necessary for stocks to catch their breath before a new surge higher”, says the Carson Group’s Ryan Detrick.