[ad_1]
© Reuters. Citi says bears facing ‘painful’ squeeze over next 2-6 weeks
By Senad Karaahmetovic
The market dynamics may have changed recently, paving the way for a tactical bounce in the U.S. equities, according to Citi strategists.
Stocks rallied yesterday in response to the miss with tech-heavy closing the day over 7% higher. The strategists believe the ongoing bear market rally can continue as there are no “solid catalysts”, at least until the new batch of key data (jobs, FOMC, CPI) is released in December.
They remind investors that the , Treasuries, and tend to follow through their initial moves after CPI surprises to the downside.
“It’s difficult to find any bearish catalysts between now and the December payrolls, FOMC, CPI. This doesn’t mean that we think equities are all of a sudden in a bull-market again. EPS is a major risk in 1H 2023, but over the next 2-6 weeks, the market can painfully squeeze for the bears,” the strategists wrote in a client note.
The dollar selloff can continue into December with Citi strategists seeing the (NOK) as a major beneficiary.
“We do not think that the overarching narrative has shifted to one which is structurally bullish for the global economy. That said, things are much less bad than they were in September. In order to become structurally bearish the USD, we need to be structurally bullish the global economy,” they explain.
[ad_2]
Image and article originally from www.investing.com. Read the original article here.