Traders were revaluating the present state of the market following the S&P %00 wiped out all its 2020 losses on Monday, in an epic rally that has shocked the Wall Street establishment. It took just 53 sessions for the index to restore the nearly $10T in value that was erased since an intraday low on March 23.
Like SocGen’s Andrew Lapthorne said in a note “That this is all happening during one of the biggest economic crises and collapses in profitability in living memory is incredible” ,which makes is difficult to understand in front of a common sense perspective, because in a matter of weeks from doom to boom the market changed.
Could we attribute it to the fact that a strong answer in a Monetary and Fiscal policies both coordinated in the same direction (?), as per table under:
(BofA)
Even if we consider just the fiscal and monetary policy working together should that be enough to create such an intense climbing on the stock market and with the speed presented? Time will for sure tell us the truth… or make is verdict.
Unless this is just a spike with no common sense that will lead to a higher disrupt of the market in close future increasing the past losses, if we consider that this coming sing will fall together when the rally fades is energy.
One thing is for sure we are living uncharted waters and we are just on the beginning of them.
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