Key inflation gauge was up 4.9% in April: ‘be sceptical of rallies’
Invezz is an independent platform with the goal of helping users achieve financial freedom. In order to fund our work, we partner with advertisers who compensate us for users that Invezz refers to their services. While our reviews and assessments of each product on the site are independent and unbiased, brands may pay to appear higher up our table rankings or place ads in specific areas of the site. The order in which products and services appear on Invezz does not represent an endorsement from us, and please be aware that there may be other platforms available to you than the products and services that appear on our website. Read more about how we make money >
May 27, 2022
NewEdge Wealth’s Cameron Dawson says be sceptical of market rallies.
The benchmark S&P 500 index is up another 2.0% on Friday morning.
The Core PCE Price Index was up 4.90% on a year-over-year basis in April – a slight decline from the previous month but still close to a forty-year high, the U.S. Bureau of Economic Analysis reported on Friday.
Dawson’s remarks on CNBC’s ‘Squawk Box’
Market, however, is focusing more on the sequential decline in pricing pressures. The S&P 500 index is up another 2.0% on Friday – it’s fourth consecutive day of gains, which, as per NewEdge Wealth’s Cameron Dawson, should be taken with a pinch of salt.
Are you looking for fast-news, hot-tips and market analysis?
Sign-up for the Invezz newsletter, today.
The challenge we have is that we are in a downtrend. So, I think we have to be rather sceptical of rallies here because the risk is that we hit overhead resistance and roll over, and the rally doesn’t stick.
Friday’s inflation data for April came in line with the Dow Jones estimates. The benchmark has recovered about 7.0% from its low in recent days.
It might just be a little too soon to be optimistic
According to the chief investment officer, it’s a bit too soon to think the U.S. equities are out of the woods now. Explaining why this morning on CNBC’s “Squawk Box”, Dawson said:
We can’t judge it based on one day. Yesterday, volume was rather weak. There was good volatility to the upside, but we need to be careful once we start hitting up against those 50 and 200-day moving averages that are now downward sloping.
She also quoted the dotcom bubble to reiterate the risk associated with the bull traps. SPX is still down roughly 15% versus the start of the year 2022.
68% of retail CFD accounts lose money
Stocks & Shares