Traders on the NYSE, May 6, 2022
Futures on stocks were higher on Sunday night after a week of sharp losses that ended on a high note, and ahead of a week of big gains for retailers.
Futures pegged to the Dow Jones Industrial Average rose 89 points, or 0.3%, and S&P 500 futures added 0.4%. Nasdaq 100 futures jumped 0.6%.
On Friday, the Dow rose 466.36 points, or 1.47%, and the S&P 500 rose 2.39%. The Nasdaq Composite jumped 3.82% and posted the biggest one-day gain since November 2020. However, all three averages showed losses in weeks.
Profits came at a time when investors were moving into easing mode to stop a bad week for stocks when the S&P 500 nearly sank into bear market territory.
It remains to be seen, however, how long the rally will last or how many more stocks should fall before this year’s downward trends.
“Given the history of bear markets, combined with the fact that the Fed has just begun its cycle of raising rates and would like to see financial conditions continue to tighten so that demand goes further, this rally is likely to weaken,” Quincy Crosby said. . , chief capital strategist at LPL Financial.
However, some investors and analysts say that whether there is a bottom or not, there are good opportunities to buy at current market lows.
“I’m not calling the bottom here, but it’s possible to get an average price in dollars,” said Sylvia Jablonski, CEO and director of investment at Defiance ETFs. “When you sit on a pile of cash, you record losses due to inflation. Investing in stocks or asset classes you believe in … it’s less evil. Sales fatigue will ease, the market will be unlikely Dow and S&P will be in the territory corrections six months to a year. “
The retail earnings season begins this week, and several major retailers are expected to report first-quarter results, including Walmart, Target and Home Depot. Elsewhere Deere is also on deck along with several technology companies.
This week, investors will also look at retail sales data, which can give them an idea of how retailers are managing inflation, which remains around its 40-year high.