Friday, May 27, 2022

US Market Wrap 05/27/2022

- Stocks have continued to recover from a seven-week selloff, with institutional investors rearranging their portfolios potentially increasing shares by the end of the month.

- The S&P 500 erased its losses from May and scored its best weekly increase since November 2020. According to a Bank of America report using EPFR statistics, global stock funds recorded their greatest inflows in ten weeks, led by US shares. The Nasdaq 100 outperformed major benchmarks, with Apple and Tesla each rising by more than 4%. Dell Technologies stock soared as the company's sales surpassed expectations.

- The dollar dropped, and Treasury yields fluctuated.

- Monday is a holiday in the United States, therefore markets will be closed.

- Fears that hawkish central banks may tip the economy into a recession have gripped markets this year, with analysts split on whether equities have hit a bottom. Morgan Stanley and Bank of America recently warned that additional losses might be on the way, while Blackrock Investment Institute downgraded developed-market stocks to neutral. Meanwhile, CitiGroup experts advised investors to re-enter the stock market, particularly in Europe and emerging economies, because of their attractive values.

- Value stocks are losing their appeal as bond yields soar and the economic recovery grinds to a standstill, according to strategists at Credit Suisse Group AG and Bank of America. Value stocks have been mostly immune to this year's market downturn, as investors sought refuge in lower-cost equities despite fears of increasing interest rates.

- US consumer sentiment fell even lower in late May, to a new decade low, as rising inflation fears dampened the economy's prospects. In a separate study, inflation-adjusted consumer expenditure increased by the greatest in three months in April, indicating that families were coping with continued price pressures by drawing on their savings.