News

Published: May 8, 2023
Updated: May 8, 2023

Market volatility persists through the first 7 days of May 2023 as concerns about the economy linger

US Markets strengthen; however concerns still linger about Global Banking contagion

US markets showed a strong comeback on Friday, with the Dow surging by 547 points, its biggest one-day gain since early January. The S&P 500 also rose by 1.8%, and the Nasdaq gained 2.3% after four consecutive days of declines. However, the market is still far from shedding its worries, as Wall Street remains concerned about the health of the banking sector and the possibility of a recession.

OPEC + rate hikes move fails to stop the downfall in prices

Despite the recent uptick in oil prices, the market remains concerned about the rate hike slowdown in the economy, which has caused oil prices to fall for the third straight week. The US VIX rose 9% this week, after falling for six straight weeks, adding to the ongoing volatility.

CPI data to determine FED's next course of action

The release of CPI data for April this week will determine the course of action for the next Fed meeting in June. However, the strong April jobs report has renewed concerns that the economy is still too hot. The US added 253,000 jobs in April, exceeding the estimate of 180,000 jobs. Moreover, the unemployment rate fell to 3.4%, versus the estimated 3.6%.

Indian Markets to act cautious amidst global economy downturn concerns

Despite the recent market rally, volatility persists as concerns about the economy linger. Wall Street's worries about the banking sector and the possibility of a recession, coupled with ongoing concerns about the rate hike slowdown and the CPI data, have kept investors on edge. It remains to be seen how the market will react in the coming weeks, but it's clear that caution remains the watchword for investors.