Since the beginning of the year, the stock market has been hit hard due to economic and geopolitical factors, including 40-year high inflation, worries about the Fed’s forthcoming interest rate hikes, an escalating Russia-Ukraine war, and worsening supply chain issues. Although the major U.S. equity indices have managed to recover from the correction territory since March, they are now sliding again due to rising U.S. Treasury bond yields amid expectations of the Fed’s tighter monetary policy and a resurgence of COVID-19 cases in China. This is further fueling the stock market’s volatility.
However, expectations of a continuing recovery by the U.S. economy this year are still strong. According to the Bureau of Labor Statistics, the nation’s unemployment rate declined to 3.6% in March, as the economy added nearly 431,000 jobs. Therefore, it may be high time to invest in hard-hit stocks with strong financials and solid earnings growth prospects, which are expected to witness significant price appreciation in the coming months.
