REUTERS: The U.S. stock market has rebounded swiftly despite a raft of terrible economic news, driven by a massive boost from the Federal Reserve, hopes of a successful reopening of the economy and possible coronavirus treatments, as well as investors' fear-of-missing-out. But not everyone is buying the bounce.
The stockmarket has changed its mood swiftly since March 23 - when the S&P 500 dropped as much as 35per cent below its Feb. 19 peak. But trading has been volatile. Since then the index has closed up more than 1per cent in ten sessions with its biggest daily gain at 9.4per cent on March 24. It has fallen more than 1per cent six times and the deepest cut was 4.4per cent on April 1.
Chris Beauchamp, analyst at online trading firm IG, said investors"continue to be confounded by the strength of the rebound in stock markets, which have apparently decided that the coronavirus crisis is receding in intensity." However, he said that with earnings season intensifying this week,"the rally faces more hurdles."
Investors have also been reassured by signs U.S. coronavirus cases may be peaking and on Friday stocks were buoyed by a report that COVID-19 patients with severe symptoms had responded well to a drug from Gilead Sciences even though full trial data for that drug had yet to been analyzed. Bernstein argues that if economic progress in China - the first country to report coronavirus cases- is any guide it doesn't bode that well for the U.S economy in the near term.
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