The current stock market fall has been due to the conflict in Eastern Europe and concerns about increasing inflation and interest rates. Amid all these, few signs show that investors can expect the current stock market fall is over.
As the stock market in the US nears the end of a challenging first quarter, investors are considering what can help equities in the months ahead, with high cash levels at companies one possible boost as CEOs use cash for share buybacks and dividends or mergers.
Rising interest rates, as the Federal Reserve tightens monetary policy, and rising inflation and uncertainty about the Ukraine crisis continue undermining the current stock market’s outlook. However, companies’ ability to use cash could reduce a few concerns of investors.
Rising interest rates, as the Federal Reserve tightens monetary policy, and rising inflation and uncertainty about the Ukraine crisis continue undermining the current stock market’s outlook. However, companies’ ability to use cash could reduce a few concerns of investors.
According to a jobs report, the US economy is recovering, and employers are hiring aggressively, adding 431,000 jobs (March 2022). It demonstrates the economy’s resiliency amid a still-destructive pandemic, Russia’s assault on Ukraine, and the highest inflation in 40 years.
Job creation reduces the unemployment rate, which is 3.6% today – the lowest rate since the pandemic and slightly higher than the half-century low of 3.5% set two years ago.The government also revised its estimate of hiring in January and February by 95,000 jobs. Average hourly pay has risen to 5.6% over the past 12 months, good news for employees across the economy.
Investors have mostly ignored a bond market recession signal triggered this week. In addition, 10-year and 2-year Treasury rates inverted for the first time.For some investors, the inverted yield curve indicates that the economy is on the verge of a recession. However, the inverted yield curve does not forecast when one will occur, and history shows that it can take more than a year or longer.