Markets staged a massive rebound this week, led by some of the worst performing stocks including Chinese and tech names. Investors took their lead from the US Federal Reserves hawkish comments supporting sustained interest rate hikes to control inflation while not reducing GDP growth expectations.
Buy signals sprouted across many indicators. Put/Call Ratios are rolling over to buy signals after reaching heights not seen since the start of the COVID pandemic.
Stifel and Bank of America Merrill Lynch notes show the extent of the pessimism among institutional investors and advisers. Such pessimism is often met with strong counter trend rallies like the one experienced last week.
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