From the Wall Street Journal’s "Stock Futures Edge Up Ahead of Jobless Data" posted early Thursday:
U.S. stock futures inched higher ahead of a batch of corporate earnings reports and fresh data on the number of Americans seeking unemployment benefits...
Stocks have ripped higher in recent weeks, pushing the S&P 500 up for four of the past trading days and 13% higher from its mid-June low. Broadly positive earnings reports, coupled with signs that some drivers of the inflation surge are easing, have boosted the partial recovery in stocks after a difficult first six months of the year.
But some investors say volatility is likely to return, especially if the slowing economy begins to take a toll on the outlook for corporate earnings later in the year. Some money managers also say markets have been overly eager in predicting that the Fed will stop raising interest rates and then cut them next year.
“We could be in a bit of a bear-market rally,” said Desmond Lawrence, senior investment strategist at State Street Global Advisors.
Investors appear to be reasoning that slowing economic growth will pull the Fed back from raising interest rates, which would boost the price of stocks and bonds, Mr. Lawrence said. “That might be a little bit premature,” he said, adding that expectations of corporate earnings “are pretty elevated for what seems to be turning into a slowdown.”
Charts: Yahoo!Finance sees a bearish relative strength index (RSI) pattern. Max pain stays at $157.50 with a call mountain at $165 (down $5).