NEW YORK (Reuters) – Wall Street’s stock indexes rose 3% on Monday, boosted by better-than-expected Bank of America earnings, and traders debated whether recent wild swings indicated that some bottom forming after a new bear. market lows were reached last week.

On Thursday, the benchmark S&P hit its lowest level since November 2020 after warmer-than-expected consumer price data boosted expectations that the Federal Reserve’s aggressive rate hike path would prompt a retreat. But stocks staged an epic rally that day as traders speculated that a range of technical and positional factors had come to the fore.

The S&P fell 2.4% on Friday, marking a weekly decline of 1.5%.

MARKET ACTION: STOCKS: The Dow was up 1.68%, the S&P 500 was up 2.54% and the Nasdaq was up 3.17%

COMMENTS:

JASON PALTROWITZ, DIRECTOR AND EXECUTIVE SUPPLEMENT OF CORPORATE SERVICES, OTC MARKETING GROUP, NEW YORK

“It’s a combination of factors. Of course, BofA’s positive earnings as well as others have led to positive momentum — while EPS growth is lower than the previous quarter, it’s better than expected. In addition, Friday’s selling involved uncertainty and not wanting to hold positions over the weekend. That money is back in the market at the start of the week.”

PETER TUZ, PRESIDENT, CHASE INVESTMENT COUNSEL, CHARLOTTESVILLE, VIRGINIA

“I was thinking that bank earnings, particularly Bank of America, were quite optimistic, and that together with the abandonment of restrictive policies in England seemed to be the fuel that started the market this morning .”

“There were some very rough days last week… The restraint and volatility we’re seeing is part of the underlying process. The fourth quarter is generally pretty good for markets historically.”

“We have a lot of earnings to go. This week and next week are just critical and full of earnings, but we’ll see what the guidance is for the fourth quarter and as far as people can tell for next year.”

CHRIS MURPHY, JOINT HEAD OF DERIVATIVES STRATEGY, SUSQUEHANNA INTERNATIONAL GROUP, BALA CYNWYD, PA

“I think this is a sign of more volatility to come. I don’t think this is a fundamental sign because we don’t see serious long-term buyers coming in.”

“The site is becoming very one-sided. The risk now is that if everyone is so bearish and the position is so light you will get one of those bear market rallies.”

“Most of the flow we’re seeing today is people recapturing hedges and shorts.”

“People are really trying to mislead these movements. When we get towards the bottom of the range or when we sell off a lot, you can cash in on your defense or sets and then hire them again when we bounce like this.”

“If this trend continues you’re going to have to say when we get a decent sell off, ‘Hey, I’d rather sell some of my stuff’ and when you do that it creates some buying power into the stock market. And if we hold you put them back and it can bring downward pressure.”

PAUL NOLTE, PORTFOLIO MANAGER, KINGSVIEW INVESTMENT MANAGEMENT, CHICAGO:

“A lot of what’s going on around Britain is a complete reversal of the policies they were trying to enact. Growth is outperforming value today because of the reduction in interest rates. It seems that the daily MO for the market.”

PHIL BLANCATO CEO CEO LADENBURG THALMANN ASSET MANAGEMENT

“This is the turnaround week every single year. If you look for the single best turnaround week of the year, it’s always the second week of October. If you really want to be specific around October 14 We forget that seasonality is important to the market The fourth quarter is on average the best quarter every year and on average the turnaround week happens the second week of October It’s because of the summer job, job September malaise you look at when the markets see the most amount of income Coming in after mutual fund rebalancing at the end of the quarter, it’s money coming back into the market Seasonality is playing in here now. “

“Secondly the information coming from the banks is much better than expected. Although there was a reduction in earnings they are making a significant income on their money. So it is not a recession based on consumers this recession. it’s not bank based. a recession if you can even call it that. It’s just a cyclical slowdown. Those are the best because they usually take about 10 months to recover, which is right on point where we are Inflation is not slowing the economy If we get any kind of recession Therefore, when you look at stocks that are trading below their average P/E now, stocks are fairly valued again and present a good opportunity. “

“If you look at current P/Es and forward P/Es they are both trading below the average of the last 10 years. So stocks are now offering a good price. You are seeing consistent earnings to date. have seasonality on your side, and if you look at the data so far it suggests that the economy is doing well.”

“It’s on a rough edge because of the Fed and oil is still a mystery. Ultimately we end the year up higher, much closer to 4,000 than people realize, assuming we don’t get oil shock or nutrition shock.”

SIDDHARTH SINGHAI, CHIEF INVESTMENT OFFICER, IRONHOLD CAPITAL, NEW YORK

“This appears to be a fake rally fueled by lower inflation expectations, I don’t think the rally makes sense. Interest rate hikes are not being discounted by the market.”

THOMAS HAYES, MANAGING MEMBER, GREAT HILL CAPITAL, IN NEW YORK

“It’s an offsides position.”

“Last week retail traders bought $19.9B of puts. 3:1 ratio to calls. Most ever. The closest periods were near the major lows of 2020, 2016, 2009, 2003. Everyone bought insurance after after the house burned down. Don’t pay for it. There are no sellers left.”

(Compiled by the Global Finance & Markets Breaking News team)



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