Stocks staged a comeback after last week’s tumultuous trading, but Wall Street isn’t sure whether to trust the bounce.
The Dow Jones Industrial Average notched its best day in June, surging more than 600 points, or 2.2%. The S&P 500 and the Nasdaq Composite each gained about 2.5%. U.S. stock markets were closed Monday for Juneteenth.
The pop in prices came after the prior week’s sell-off – and the S&P 500’s worst week since 2020. While some investors expect that markets may be oversold, others believe there are further losses ahead.
"The outstanding question is whether this is simply a bounce or the bottom," said Sam Stovall, chief investment strategist at CFRA Research. "I think that this could certainly be a bounce but not the bottom because the one missing ingredient is a fear-based capitulation sell-off." |
Of course, this isn’t the first time this year that investors are enjoying some relief after a sell-off.
Since January, the broad-market index on 10 other occasions jumped more than 2%, after which those gains gave way to losses. Tuesday’s S&P 500 rally would rank fifth on that list. |
