Dow Outlook Is Bleak As Trump Dreams Of A Big Stock Market Bounce

Published by Cyber Flows on

  • The stock market enjoyed one of the best performances in decades last week.
  • President Donald Trump is looking for a big bounce after the coronavirus pandemic blows over.
  • Unfortunately, the economic fundamentals point to at best moderate returns for the Dow Jones.

Donald Trump is singing the stock market’s praises after one of the best weeks on Wall Street for almost 50 years. Unfortunately, while the President is optimistic about a V-shaped recovery, evidence suggests more pain could be ahead for the Dow Jones.

Trump Looks For A V-Shaped Recovery As Dow Jones Narrowly Misses Best Week Since 1938

President Trump has taken every opportunity to inject some optimism into investors when the stock market has bounced, but previous efforts have fallen flat. Backed by some dramatic gains in the Dow and S&P 500, will he be right this time? It’s not looking good.

Currently trading above 23,000, the Dow Jones has risen like a phoenix from the ashes, after the coronavirus pandemic briefly knocked it into the 18,000 point handle.

While Trump is correct, it was the S&P 500’s best week since 1974; it was almost the best for the Dow since 1938. History has shown us these moves can be a strong indicator something is going wrong under the hood.

Stock Market Ignores Fundamentals As Bulls Dominate

The S&P 500 has apparently been powered by optimism about the slowing of the coronavirus curve in the United States.

Adding to this, Fed-enabled denial about the impact of the shut-down on debt-laden corporate “zombies,” has created an obvious disconnect between fundamentals and price action. All this has stock market bears tearing their hair out.

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