February 2, 2023
By Peter Bower
The Federal Reserve and its policies are retreating in importance to investors. Inflation has come down, and an end to rate increases is in sight, so the spotlight returns to the economy and how individual companies are doing. The answer from most of them is pretty good; earnings are holding up well, and some are reducing expenses, undoing some of the headiness from the cheap money days.
The stock market has been anticipating all of this. The bottom in the correction was probably in October of last year. (This is classic since so many previous corrections have also bottomed in October.) Now, the market is breaking out. Optimism is returning for a reasonably healthy business environment and for future returns. Risk appetite is back.
The technical indicators that the Bull and his partners follow have been pointing to higher stock prices for some time now. The Lonely Bull blog has been saying so since the fall of last year. The correction is over; a new bull market is upon us. The trend higher will not be a straight line, but higher will prevail. Stay steady my friends.
The Lonely Bull
