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The strategists who saw this miserable stock rout coming say there’s still more pain ahead. With the S&P 500 sliding more than 10% from recent records, bears from the likes of Mizuho International Plc and Bank of America Corp (NYSE:BAC). warn of fresh selling to come as growth momentum eases just as the Federal Reserve amps up borrowing costs. “There’s probably more downside over the next few months as the market adjusts to the reality of the Fed removing accommodation, earnings slowdown and much less federal stimulus,” said Ed Clissold, the chief U.S. strategist at Ned Davis Research, who late last year predicted a double-digit drop in stocks and today is warning of a correction on the order of 20% from the early January peak. The S&P 500 could slide another 12% as a “tightening tantrum” gathers pace, according to Mizuho strategists who came into 2022 warning of a 10% to 15% plunge in the second quarter, if not sooner. The market stress scenario is what we think is happening now.” The first half of the year could see the S&P 500 plumb a bottom as low as 3,800, down 12% from current levels. The Nasdaq 100 may trough around the 12,000 level, a fall of about 15%, Chatwell said.
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