Stocks are trying to bounce once again, but it seems like a fruitless exercise given the poor global outlook.
Stocks rebound after heavy losses
“Stomach-churning volatility continues to dominate financial markets. After the sharp falls of last Friday and yesterday, some cautious buying has come in, but it looks like the best that they buyers can muster is a holding action for now. Comments from the Fed’s Williams that 50 basis point rises makes sense at the next two meetings provided some comfort, but it certainly isn’t clear that the see-saw price action of the last 24 hours is going to resolve into even a short-term market low. Selloffs like these are never one-way affairs, so we can’t rule out a bounce, but since recession concerns appear to be rising by the day it is unlikely that equities will be able to sustain this for too long.”
Brexit fears loom again
“As if the recession worry wasn’t enough, investors might have to cope with some concerns about a fresh clash between the UK and EU, according to the Irish government. The pound has been on the back foot against the dollar and the euro, and with the UK economy facing a bleak time a Brexit kerfuffle is the last thing it needs. All in all, it is going to be much tougher for the BoE to keep hiking with the economy teetering on such a precipice.
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