Sharp Fluctuations In Stock And Bond Markets | David Darst Speaks To Bloomberg Asharq

Sep 25, 2022 | 1 min

Bloomberg Asharq hosted David Darst, CFA and Chief Advisor to The Family Office, to discuss the sharp fluctuations in stock and bond markets. Below are the highlights of the interview:

  • Asset prices, especially equities, reached the bottom before the VIX index peaked at almost 40%. This might happen if a new shock happens in the euro region where the currency keeps declining or in Japan that keeps expanding the government bond purchase program.

  • GDP dropped -1.6% in Q1 2022, and the Federal Reserve (the “Fed”) in Atlanta expects a fall between 1% and 2.1% in Q2, meaning we entered recession.

  • The Fed keeps trying to curb inflation as the economy is slipping into recession. But falling oil prices could curb inflation and fight recession.

  • Markets are trying to determine the capacity of central banks like the European Central Bank and the Fed to maintain tightening policies and understand corporate returns.

  • Caution is advised by preserving cash or investing in defensive stocks like pharmaceutical and consumer goods companies that achieve good returns in similar circumstances.

Watch the full interview above.

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