Despite current CPI data and the US Federal Reserve's interest rate decision, there are almost no signs of "panic" in the market, even preparing for upward movements.
On a day when the US currency policy outlook is facing many variables, stock traders are worried about missing the next potential rebound.
Due to the rare release of US inflation data in the hours leading up to the Fed's interest rate decision, there is a high probability of market confusion. However, according to a report released on Tuesday, JPMorgan's trading department "did not panic" and took almost no hedge measures.
Bank stock sales trader, Matt Reiner, said in the report, "Customers are worried about missing out on the opportunity to rise rather than short opportunities. My clients are cutting downside protection and increasing long positions."
Investors fear falling behind in an environment where US stocks are constantly reaching new highs. JPMorgan's US market intelligence trading department wrote in the same report that in the case of inflation data matching or slightly exceeding expectations, if Fed Chairman Powell’s press conference is neutral or dovish, such a combination will ultimately be bullish for the stock market.
On Tuesday, Apple's (AAPL) stock soared and drove the S&P 500 Index (SPX) and the Nasdaq 100 Index (NDX) to historic highs on Tuesday, due to the announcement of several artificial intelligence features. Since the beginning of this year, the S&P 500 Index has risen by nearly 13% and the Nasdaq 100 Index has risen by 14%. At the same time, short-term volatility in the US stock market has fallen to a low level.
Technology stocks continue to lead, with the sector currently accounting for 32% of the S&P 500 Index, close to the historical high of 35% set in the Internet era. The US stock market's gains this year have been highly concentrated, with only four stocks, Nvidia (NVDA), Microsoft (MSFT), Meta Platforms (META), and Amazon (AMZN), contributing more than 56% of the rise.
Bank of America's strategist also pointed out that its clients are once again rushing into US stocks, especially technology stocks. Analysts led by Jill Carey Hall stated in a report released on Tuesday that Bank of America Securities clients bought net US stocks for the first time in six weeks last week, led by retail investors and hedge funds, while corporate clients bought back shares close to a record level.
Editor/new