US Fed

stock market can collapse by 50%, according to Richard Bernstein Advisors. The catalyst for this apocalypse may be the decision of the US Federal Reserve on Wednesday rates. The bubble in the stock market is ready to burst and bring the shares market double. The beginning of this process can put an increase in the Fed’s rates on Wednesday immediately by 0.50%, up to 1.00%, according to Richard Bernstein Advisors (RBA), which is engaged in investment consulting of customers.

The largest bubble was swollen in the high technology sector, they note in RBA. American high -tech index Nasdaq lost about 12.7% in April – this is the worst dynamics since 2008. The US S&P 500 wide market index showed the most rapid fall from the beginning of the pandemic, falling by 8.8%.

“Look at the history of bubbles. When they show a greater correction, a decrease can reach 50%. And as a rule, this happens when the regulators begin to tighten a monetary policy,” said Dan Suzuki, deputy director of RBA, who was previously marketable. Strategist at Bank of America – Merrill Lynch.

in his words, The biggest issue for investors is the uncertainty of what will be in the final statement of the US Federal Reserve. The Richard Bernstein Advisors forecast about the collapse of the shares market is based on the assumption that the growth in interest rates will damage promotions, especially technological.

on Monday, the profitability of the reference 10-year-old tenderris exceeded the level of 3% for the first time since December 2018. The Bloomberg US Treasury index, which measures the cost of bonds, lost about 8% this year, fixing the worst quarter in the history of observations.

according to The Bloomberg survey, 75% of respondents are sure that the yield of 10-sides will grow to 3.25% before reaching its peak. If the respondents are right, risky assets from growth shares to currencies of developing markets will face a greater problem.