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Market Volatility Continues Ahead of This Week’s Potential Market-Moving Events: Market Commentary from Cabana’s CEO – November 7, 2022

2 years ago

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Markets of all types continue to experience volatility around each data point that is reported. The Federal Reserve hiked rates another 75 basis points last week and Chairman Powell reiterated that there was more to come. Investors appear to have given up on a halt to rising rates and are hoping for a simple slowdown. The pain that has been experienced in the bond markets this year cannot be overstated. Bond prices move opposite of rates and suffice to say prices have been pummeled as rates have skyrocketed in response to historic inflationary pressures.  

All this has led to most “experts” giving up on the idea of avoiding a recession next year. The debate now seems to be on just how bad it is going to be. As I pointed out some months ago, a recession induced bear market averages a decline in stocks of nearly 40%. If history plays out, we have quite a bit lower to go. The upside is that no one has a crystal ball. If they did, they sure wouldn’t be talking about it.  

Moving forward, there are some big potential market-moving events this week. In addition to earnings from a variety of companies, we have midterm elections tomorrow and the October CPI number comes out Thursday. I think these all have potential to move markets in a big way.  

Disclaimers

January 17, 2024

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The Nasdaq Composite Index is a market-weight capitalization index that covers more than 3,000 stocks listed on the Nasdaq Stock Market. What is the Nasdaq Composite, and What Companies are in It? | Nasdaq