Wall Street is debating whether the bear market still has legs
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Jason Ma
Oct 17, 2022, 16:18 IST
Following a glut of IPOs in 2021, broader market and economic uncertainty has led to a 2022 tech IPO hiatus.iStock/Getty Images
Good morning, this is Jason Ma starting off a new week, which will see a surge of quarterly earnings reports. Some of the big names due include Netflix, Tesla, Johnson & Johnson, and Goldman Sachs. So far, results from the big Wall Street banks have been mixed, with JPMorgan and Citigroup beating but Morgan Stanley falling short of forecasts.
The slate of upcoming economic reports is less dramatic, though Wednesday will feature housing starts and the Beige Book, which will set up the Federal Reserve for its next policy meeting in November. Wall Street is widely pricing in a fourth consecutive rate hike of 75 basis points.
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1. Wall Street is debating whether the massive upside reversal on Thursday was real or a head-fake. From intraday lows to highs, the Dow Jones Industrial Average saw a 1,500-point swing. For the S&P 500, Thursday marked the fifth largest intraday reversal from a low. And for the Nasdaq, it was the fourth largest.
Looking forward, he still sees a "Big Low" coming in markets — but is waiting first for signs of panic from the Fed. He noted that the economy remains too strong, especially in employment and manufacturing, for the central bank to consider cutting rates, which is usually something it does around when the Big Low sets in.
"We are, in my opinion, coming to the end of this bear market," Scaramucci told CNBC on Friday. "This could've been a bear market rally, but I don't think so. I think this is the start of something new. I think there was full-blown capitulation on the short side yesterday and lots of institutional buying."
9. UBS Global Wealth Management explains what investors should do as rates rise and the economy slows. For at least a little while, nothing is going to deter the Fed from hiking rates, said chief investment officer Mark Haefele. Here's what he thinks investors should do now.
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Curated by Jason Ma in Los Angeles. Feedback or tips? Email jma@insider.com.
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