- Retail investors' strong buy-the-dip impulse should help support stocks over the coming months,
JJ Kinahan said. - The
TD Ameritrade strategist said uncertainty aboutinflation and the Fed should bring volatility, however. - Retail investors have been snapping up recent dips largely through buying ETFs, analysts say.
- $4.
Retail investors have been eagerly buying the dip and it's supporting
"Anytime you see stocks move down 3% or less, you're seeing people come out really quickly to buy things," he told Insider this week.
Kinahan said he thinks the buy-the-dip impulse is set to continue. And he said he doubts there will be big drops in US stocks this year.
But he said uncertainty around $4 and when the
Kinahan likened investors' persistent buying to American football tactics. "If you're running a play that works, you don't stop running it until the other team stops it. Right now,
TD Ameritrade is one of the biggest electronic brokers, with more than $1 trillion in client accounts.
The $4, the US benchmark stock index, has consistently hit record highs despite periodic sell-offs. For example, stocks fell around 2.5% over two days in the middle of July, only to rise 3.7% over the next five days.
On one of the days stocks slid in the middle of July, retail investors bought $4, according to data company VandaTrack.
Amateur traders snapped up exchange-traded funds like State Street's SPY, which tracks the
JPMorgan said in a note at the end of July retail investors had also bought the dip in Chinese stocks, which have tumbled after a $4 by Beijing.
Nikolaos Panigirtzoglou, a JPMorgan market strategist, said retail investors had also been drawn to ETFs as a way to gain exposure to cheaper Chinese stocks.
However, Viraj Patel, a strategist at Vanda, said
Kinahan said the reopening is likely to boost the economy and so support US stocks over the coming months.