🎉A strong rebound🪜

Investors bought the dip in stock prices as bond yields retraced. The poorer earnings result from JPMorgan did not dampen the risk on sentiment. 

The dip buying ahead of major earning season comes after two days of selling pressure. JPMorgan missed earnings estimates which registered a $2.63 profit per share instead of expected $2.72. Revenue dipped and mortgage revenue fell too. 

Pika World will be exploring other banks result to see if the banking sector is facing headwinds in this earnings season. 

🏸What’s on her mind or Brain?💊

It’s good news that Brainard is surprised with the inflation gauge that shows moderation in March. Nonetheless, she projected that more data should be monitored in the coming months. 

As we have seen, although the CPI had risen by 8.5% in March, the primary core inflation, which removes food and energy prices, actually rose 0.3% in March instead of 0.5% in February. This latest reading is the smallest increase in the past 6 months of gain. 

Investors welcome moderation in Core CPI as they are keen to re-live the idea that perhaps inflation is transitory and that bond yield rise will moderate and support high tech stocks valuation. 

Despite the relief, market participants will still place greater on the coming earnings report coupled with the FOMC meeting in May. Again, Fed officials appeared to drill the same message of faster tightening. 

🚖Falling Car Sales- A bad sign?🚌

As inflation and a tightening monetary policy hit economic growth, car sales demand is expected to fall. 

Analysts are viewing that perhaps this piece of bad news is priced in. Some pointed out that auto sales in a historical context tend to be a leading indicator of whether the economy is gearing into a recession. 

However, we are already seeing weak auto sales due to the shortage of semiconductors for more than a year. 

Falling vehicle prices have been a critical strain on stocks like Ford and General Motors, while used car prices have been at record levels for the past months. The latest earnings will perhaps give investors the much-needed insight into supply chain status before investors make the next move.