Markets on Friday sought even ground following a week of heavy selling. Despite a slight bounce for the S&P 500 and Nasdaq Composite, the major averages ended the week on a down note. The S&P 500 posted its worst week since 2020.
Traders on Friday also grappled with a “quadruple witching,” a phenomenon that comes four times a year when stock index futures, single-stock futures, stock options and stock index options expire simultaneously.
Nonetheless, markets have been volatile in recent days as traders continue to digest new data and the Federal Reserve's rate hikes. The moves have left many traders questioning how far off a recession could be, if we haven’t already entered one. |
"Near-term recession has become a foregone conclusion for many investors; the only questions now are its duration and the severity of its impact on earnings," said Wells Fargo's Chris Harvey.
Friday’s moves may also signal investors “bottom fishing” or searching out opportunities in the most beaten-up areas of the market.
“I don't know if it's necessarily signaling that our six-week recession is over or anything like that,” said John Lynch, chief investment officer at Comerica Wealth Management. “I just think that today is probably a combination of short covering, and then just investors seeking out who's been hit the most."
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