Tag: Economy

Market Strategist Suggests 2023 May Be the Year to Buy

February 8, 2023 /
Stock Market News Today: Market Strategist David Rosenberg on stock market outlook.
Stock Market News Today: Market Strategist David Rosenberg on stock market outlook.

Market strategist David Rosenberg suggests 2023 may be the year to buy stocks, after the market has dropped another 30% per his prediction.

The former chief North American economist at Merrill Lynch says “the recession’s just starting”, stating the S&P 500 may bottom out around 2900, to which at that point stocks will look attractive again.

Rosenberg is forecasting a bullish market in 2024, which suggests 2023 will be the year to buy and bulk up to build stronger portfolios.

While investors may try to time the bottom, even Rosenberg’s prediction is just that, a prediction.

The market may still drop as the fed continues to regulate and assess interest rate hikes, but how low the market may drop is still uncertain.

Short sellers lost more than $81 billion in only the first month of the new year due to 2023’s rallies.

The SPY is up more than +7% this year-to-date with many popular stocks having much larger gains this first quarter.

  • AMC Entertainment Holdings Inc. (NYSE:AMC) +76.46%
  • AMC Preferred Equity (NYSE:APE) +165%
  • Tesla Inc. (NASDAQ:TSLA) +79.54%
  • GameStop (NYSE:GME) +38%
  • Disney (NYSE:DIS) +23.30%

Related: Big Reddit Stocks Worth Putting on Your Watchlist This Year

So, although the start to this year has been rather bullish, Market Strategist David Rosenberg says he doesn’t believe the bottom is in yet.

Is Wall Street out of touch?

Rosenberg says investor sentiment is out of line.

“There is a disconnect between how investors feel about the outlook and how they’re actually positioned. 

They feel bearish but they’re still positioned bullishly, and that is a classic case of cognitive dissonance.

We also have a situation where there is a lot of talk about recession and about how this is the most widely expected recession of all time, and yet the analyst community is still expecting corporate earnings growth to be positive in 2023.”

Goldman Sachs says bigger short squeezes are coming since the meme stock frenzy in 2021.

Goldman Sachs (NYSE:GS) is reporting hedge funds betting against stocks globally abandoned those short positions last week at the fastest pace since 2015, surpassing the speed of exits during the ‘meme stock’ frenzy in 2021.

According to the Goldman note, the speed at which hedge funds exited bearish positions surpassed that seen in January 2021 when retail traders managed to squeeze short sellers out of stocks such as videogame retailer Gamestop (NYSE:GME) and movie theatre operator AMC Entertainment Holdings (NYSE:AMC).

During the ‘meme stock’ frenzy in 2021, GameStop shares rose to nearly $500 per share, or +1,500% that year.

AMC shares rose from $2 early that year to an all-time high of $72 per share, more than +3,000%.

Today, both AMC and GameStop remain heavily shorted with AMC Entertainment having a higher-than-ever cost to borrow fee.

Is the stock market crash over?

is the stock market crash over

While the stock market has performed relatively well going into 2023, Market Strategist David Rosenberg believes the S&P 500 has not bottomed out yet.

Rosenberg predicts 2024 will be a bullish year for the market which suggests buying the 2023 dip could prove to yield gains next year.

Stocks fell all throughout 2022 but have begun to bounce back in 2023; will 2023 see gains and consolidation?

I’m curious to hear your thoughts on this.

Feel welcome to leave a comment down below.

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Market News Today - Market Strategist suggests 2023 may be the year to buy stocks.
Market News Today – Market Strategist suggests 2023 may be the year to buy stocks.

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Where Is the Stock Market Headed in 2023?

January 2, 2023 /
Where is the stock market headed in 2023.
Stock Market News: Where is the stock market headed this year?

Where is the stock market headed in 2023? For many of us, the bear market of 2022 was the first bear market we’ve ever experienced.

I’ve been invested in the stock market since 2019, but many of my readers began investing in 2021.

In 2021, many experienced their first bull market, and it was incredible.

So, what can we expect from the market in 2023?

Let’s look at the S&P 500 index and see what experts are saying.

SPY Stock at A Glance: Will Stocks Keep Going Down?

SPY stock (S&P 500) is currently trading in a channel where we may still see the market retest $400.

Breaking below this channel allows us to identify a strong probability of SPY dropping as low as $322.

See the figure below.

SPY Stock (S&P 500) downtrend channel.
SPY Stock (S&P 500) downtrend channel.

This drop in share price means the stock market will plunge to retest its macro channel.

If price breaks below this channel, the U.S economy may experience a much larger market crash.

A bounce on the trendline may momentarily move the market back up until it retests its highest level on that channel.

A break above this channel could eventually bring the stock market up later in the year.

But why not in the beginning of 2023?

Bank of America and Wells Fargo CEOs are expecting a recession to hit the United States during the first quarter of the new year and subside sometime in the last quarter.

Elon Musk recently sold 22 million shares of the company cashing in approximately $3.6 billion earlier in December, stating that he’s preparing for a ‘serious’ recession.

A recession would likely trigger further selloffs causing the market to crash.

But what are other experts saying?

What Are Experts Saying About the Stock Market?

what are experts saying about the stock market
What are experts saying about the stock market?

While technical analysis shows us the stock market is in a downtrend channel, experts are saying a recession will have a great impact on the continuation of a bear market in 2023.

Dan Raju, CEO of Tradier, a brokerage platform says, “The Fed’s obsession with recession will likely result in more interest rate hikes in the first quarter of 2023, which means that we are going to have continued volatility in the financial markets.”

“Two-in-three economists are forecasting a recession in 2023, yet corporate earnings estimates haven’t come down to reflect that,” says Greg McBride, CFA, chief financial analyst, Bankrate.

“If the economy continues to slow and quarterly earnings calls in January reveal a dour outlook for the year, corporate earnings estimates will be marked down and the market could have a renewed tumble.”

Related: Worst and Best Performing Stocks of 2022

“We feel that going into the fall, the stage will be set for a strong recovery from the 2022-2023 cyclical bear market,” says David Keller, president and chief strategist at Sierra Alpha Research.

“If and when a market bottom emerges in the first half of 2023, we’d be looking to technology as a fantastic long-term opportunity, given the heavy drawdowns since late 2021.”

How Can Retail Investors Navigate These Waters?

where are stocks headed in 2023.

The markets aren’t coming down forever, in fact analysts are predicting a recovery sometime in the 3rd quarter of 2023.

Retail investors may always take advantage of these market lows by adding to their portfolios before we begin to see the stock market take off again.

It’s important to remember that bear markets usually last about 9.6 months on average where bull markets tend to last around 2.7 years.

So, while this bear market might drag on a bit longer, it merely gives investors opportunity to buy low.

What are some stocks you plan on buying in 2023?

What are some of your favorite stock picks for the new year?

Leave a comment down below.

For more stock news and updates, join the newsletter to receive weekly market news and notifications straight to your inbox.

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SPY Stock Continues to Make Lower Lows and Lower Highs

December 14, 2022 /
Market Trend: The S&P 500 (SPY Stock) continues its downward trend.
Market Trend: The S&P 500 (SPY Stock) continues its downward trend.

Looking at the SPY for the year and we see that the market continues to make lower lows and lower highs.

SPY stock took a big hit on Wednesday during JPOW’s speech, dropping from $405 to as low as $396.

The index closed at $399.40 but continues to be on a downward trend.

Zooming out to the full year and we see the SPY started off in January at $477 per share.

By the end of the first quarter, we see a high of $461 per share and a low of $417 per share.

In June, we see a low of $365 and a peak of $426 by the third quarter of 2022, in August.

This fourth quarter, SPY stock had a low of $348 in October, and a high of $414 in December.

SPY Downtrend Chart - Franknez.com.
SPY Downtrend Chart – Franknez.com.

Will The Stock Market Go Up Soon?

Will the stock market go up soon? Will stocks go up?
Will the stock market go up soon? Will stocks go up?

Based on the current trend we’re seeing from the S&P 500, it doesn’t seem like the market is ready for a bull run anytime soon.

Buyers failed to break the downward trend as seen in the figure above which means the probability of sellers coming in again is high.

In terms of the economy, inflation is still high at 7.11% and mass layoffs have been seen with DoorDash, Amazon, Facebook (META), Twitter, Netflix, Carvana, and many other companies.

Although JPOW said the U.S economy is currently not in a recession, both Bank of America and Wells Fargo CEOs expect a recession to hit the country during the first quarter of 2023 with some sort of light at the end of the tunnel by Q4.

“While retail payments surged 11% so far this year to nearly $4 trillion, that increase obscures a slowdown that began in recent weeks: November spending rose just 5%,” Bank of America’s CEO Brian Moynihan said.

Wells Fargo CEO Charlie Scharf said, “there is a slowdown happening, there is no question about it. We are expecting a fairly weak economy throughout the entire year (2023).”

If this happens to be the case, today’s bear market may drag out through the majority of the new year.

Leave Your Thoughts Below

Do you see this downtrend in the stock market continuing throughout 2023?

Leave your thoughts below.

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Bank of America Expects a Recession by Q1 of 2023

December 9, 2022 /
Market News: Bank of America and Wells Fargo CEO expect a recession in 2023.
Market News: Bank of America and Wells Fargo CEO expect a recession in 2023.

Bank of America is expecting a recession to hit the U.S by the first quarter of 2023.

There is a major slowdown happening says CEO Brian Moynihan.

Economists are now expecting a volatile market to persist in 2023.

A recession may be coming in the first quarter of 2023, according to forecasts by Bank of America (BofA) economists.

“A recession is very likely in the U.S.,” BoFa wrote in its Year Ahead 2023 report. The bank points out that this recession can last through the third quarter of 2023.

There’s no official definition of a recession, but many economists define it as a period of two consecutive quarters of negative economic growth or gross domestic product (GDP) decline – a drop that’s already been seen in 2022, says FOX Business.

But many Americans already believe the U.S. is already in a recession.

More than half or 56% of Americans believe the country is in a recession, according to a recent poll by YouGovAmerica and The Economist. 

Here’s the latest market news.

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Major Slowdown in Economy Points Towards a Recession

Recession News: Bank of America expects a recession in 2023.
Recession News: Bank of America expects a recession in 2023.

While retail payments surged 11% so far this year to nearly $4 trillion, that increase obscures a slowdown that began in recent weeks: November spending rose just 5%, Bank of America’s CEO Brian Moynihan said.

Even Wells Fargo CEO Charlie Scharf is saying, “there is a slowdown happening, there is no question about it. We are expecting a fairly weak economy throughout the entire year.”

American consumers are tapping the brakes on spending as the Federal Reserve’s interest rate increases reverberate throughout the economy, according to the CEOs of two of the largest American banks.

After two years of pandemic-fueled, double-digit growth in Bank of America card volume, the rate of growth is slowing.

Still, the downturn isn’t being felt equally across all retail customers and businesses, Wells Fargo’s CEO said.

Both Wells Fargo and Bank of America CEOs expect a recession by Q1 of 2023 and expect some sort of light at the end of the tunnel by Q4.

The implications of a recession end up affecting majority of the U.S. economy as corporations and businesses struggle to yield market capital in slow-growth conditions.

Wages are affected, unemployment skyrockets, and the banks get left with massive debt when Americans can no longer afford to pay their credit card bills or mortgages.

Do you think we will officially enter a recession in the beginning of 2023?

Leave your thoughts below.

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Source(s): FOX Business, CNBC.

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How Can the Average American Pivot in a Recession?

Recession

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