After last week’s broad-based sell-off, the U.S. stock market rebounded yesterday. Talks of possible tariff cuts on Chinese goods evoked a positive market reaction. The Dow Jones Industrial Average, which had witnessed its first eight-week losing streak since 1923, rebounded, gaining 618 points to close yesterday’s trading session at 31,880.24. The S&P 500 and Nasdaq Composite rose 1.8% and 1.6%, respectively, to close at 3,973.75 and 11,535.27.
Despite the bounce, investors need to be careful because it may be just a minor relief rally amid largely uncertain market conditions. The Fed’s aggressive interest rate hikes to tame multi-decade high inflation, supply disruptions arising from the Ukraine-Russia war, the decline in GDP in the first quarter, rising energy prices, and COVID-19 restrictions in China are expected to keep the market under pressure in the near term.
