The stock market has been facing immense pressure lately due to the Fed's potential aggressive interest rate hikes to bring down the inflation, which increased by 8.6% in May, the highest increase since December 1981. Analysts at Deutsche Bank expect that the Federal Reserve could consider a 0.75 percentage basis interest rate hike at the central bank's meetings both this week and in July. As a result, the U.S. stocks officially entered a bear market, with the S&P 500 declining more than 20% since the beginning of the year.
Hedge-fund veteran Leon Cooperman, who predicted that the U.S. economy would slip into a recession, believes the S&P 500 could drop 40% more. However, the recent market correction has caused many high-quality stocks to trade at a discount. According to Wei Li, BlackRock Investment Institute's global chief investment strategist, “U.S. stocks have suffered their biggest year-to-date losses since at least the 1960s. That’s ignited calls to ‘buy the dip.’”
