The bounce in risk assets has made it through another day, and with the VIX and oil falling there are reasons to think it will keep going.
Stocks push higher
“The week is rounding out with further upside for equities, as the general positive feeling in the wake of this week’s inflation data continues. We are now firmly into the quiet period of August, and while there is plenty of UK economic data next week major earnings are thin on the ground. But the drift higher seems set to carry on, especially since the market is apparently content to ignore any warnings about further US interest rate hikes, having been calmed by the downtick in US CPI and PPI this week.”
VIX drop gives comfort to buyers
“Never short a dull market” is a well-worn phrase, but it has plenty of truth to it. As the Volatility Index continues to fall, more investors will be happy to dip back into the market. Fresh falls in oil prices will also bolster the idea that inflation will keep edging down in the months to come.”
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