[Pneumonia Bear Market] The Dow rose 13% in two days, this key indicator may indicate that the US stocks are about to bottom out

Macro interpretation

Written by: Jingjing He

2020-03-26 07:10

The U.S. Congress has not passed the economic stimulus bill, and senior senator Bernie Sanders has threatened that if the company does not improve the content of corporate benefits in the plan, it will demand a moratorium on voting, which will weigh on the performance of U.S. stocks. The index rose 495 points (2.39%), rising 13% in two days; the S & P 500 index rose 1.15%; the Nasdaq fell 0.45%.

Technology stocks performed poorly, Netflix fell 4.18%; Facebook closed down nearly 3%; Amazon fell 2.80%; Google parent company Alphabet fell 2.51%; Apple Inc. reportedly delayed launching a new iPhone, closing down 0.55%.

The U.S. Congress has not yet announced a stimulus bill, but President Trump has indicated that he will sign it once it is passed. (Reuters)

`` 90% Rising Day '' May Bottom U.S. Stocks

As the rally in US stocks continues, some analysts predict that US stocks may bottom out soon. Stephen Suttmeier, a strategist at Bank of America, said that there was a "90% rise day" for U.S. stocks on Tuesday, meaning that 90% of the stocks listed on the NYSE had risen on that day. He pointed out that under the severe oversold conditions in the market, investors are very much looking forward to the signal of a market rise, and the "90% rise day" is an indication that the stock market may be "building a bottom."

He pointed out that a single "90% rise day" may only be a by-product of the big ups and downs in the bear market. However, if the "90% rise day" appears repeatedly, it is a key signal for the bottom of the stock market. It has previously successfully predicted to 2009, and includes 2010. , 2011, 2015, 2016, and so on.

Dow rises 11% in the past ninety years

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Bond market stabilization helps stock market rebound

Ed Yardeni, a market strategist at Yardeni Research, also said that the stock market may start bottoming out. He said that in the past week or two, many experienced investors hoped to sell bonds and cash funds into the stock market, but because the market rushed to hold cash, it was difficult to sell bonds. However, with the Federal Reserve ’s strong support for various types of bonds, debt The market started to stabilize and the stock market rebounded.

"In the future in March, April, and May, we will have some horrible economic figures, unemployment data ... but I think when the citizens feel that it is safe to go out again, the strong consumption figures will reappear," he said.

Of course, the investment market is not one-sidedly optimistic about US stocks. Some analysts warn that the development of the epidemic is the biggest indicator of the future trend of the stock market. It is expected that unless global cases of new-type coronary pneumonia (also known as Wuhan pneumonia) begin to fall, the stock market will hardly see bottom.

U.S. shares blown