Fearless day traders could power US stock market

Published Sun, Jun 14, 2020 · 09:50 PM

A SECOND wave of the Covid-19 pandemic is hitting some US states, but strategists are divided on whether this could cause yet another novel coronavirus crash in the stock market.

The selloff last week was the biggest challenge to the "V-shaped" economic recovery bet that day traders have piled into for the last two months. The question posed will continue to torment the bullish traders this week: did the US reopen its economy too soon?

Major indexes had returned to break even for the year - an improbable 35 per cent recovery for the broad Standard & Poor's 500 from the bear-market lows of March when the rally hit a brick wall last week.

US Federal Reserve chairman Jerome Powell's reassurances that the central bank was ready to intervene were eclipsed by his grim prognosis of multi-year damage to the labour market. …