U.S. stocks closed sharply higher Tuesday after retail sales data for April suggested the economy remained healthy and as investors weighed remarks by Federal Reserve Chairman Jerome Powell.
- The Dow gained +431.17 or +1.34%
- The S&P 500 was up +80.84 or +2.02%
- The Nasdaq jumped +321.73 or +2.76%
Investors bought the dip Tuesday.
In volatile markets, “you’re going to get intermittent bounces,” said Randy Frederick, managing director of trading and derivatives at Charles Schwab, in a phone interview Tuesday. The stock market probably hasn’t bottomed yet though, he said, as high inflation and rising interest rates remain a concern while “panic mode” — where the CBOE Volatility Index spikes above 45 or 50 — has yet to be seen.
“This is not the time to be going in and buying everything you can get your hands on,” said Frederick. He favors a strategy of “picking up very small quantities” of “quality” stocks that are “on sale” and investors would like to own for the long term while realizing that it’s probably not a trade “that’s going to pay off right away.”
Meanwhile, U.S. retail sales painted a picture of a healthy economic backdrop, rising 0.9% in April, slightly below the 1% advance forecast by economists surveyed by The Wall Street Journal. Auto dealers led the way but most major retail categories posted gains. The increase in sales in March, meanwhile, was raised to 1.4% from an original 0.7%…….[read more]
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