Recessionary optimism in the markets. Stocks and cryptocurrencies go up sharply

It seems that stock market investors and cryptocurrency speculators needed a US recession to start buying stocks or crypto assets. The US stock indices and bitcoin may be quite successful this month.

The recession has become a fact

Yesterday's data from the United States seem to show that the US economy has fallen into recession. This phenomenon is commonly defined as two consecutive quarters of GDP decline, which was the case in the US. The White House or Federal Reserve they make it clear, however, that there is no question of a recession and, in a way, enchant reality. It's about the details and how the US GDP is calculated. In the first quarter, the main contributor to the decline in GDP was the slump in net exports. This time around, inventories and their decline seem to be the main contributors to the decline in GDP in the second quarter. It was enough for the market to start playing bolder and bolder at the end of the cycle of interest rate increases by the Fed around 3,25 percent. at the end of the year. Previously, investors estimated the possibility of ending the cycle at 3,50-3,75 percent. What's more, the market begins to estimate the possibility of the Fed cutting interest rates by March 2023 by 0,5 percentage point. It seems that this may be the reason for the improvement in sentiment in the financial markets.

Consequently Cryptocurrency marketsomewhat pumped up by expansive monetary policy, was able to breathe a sigh of relief from an earlier massive, albeit cyclical, correction. Bitcoin rose to around $ 24, which could mean an increase of about 000%. in July. This, in turn, could mean that BTC is in for the best possible month since October 30. Other cryptocurrencies, including ethereum, have also seen a sharp rise in value. The second largest cryptocurrency by market capitalization grew by more than 2021% in July, making it one of the best months in ETH history.

Stock exchanges definitely up

Coming back to the stock indices, these also seem to bounce back this month. Technological Nasdaq has risen by more than 11 percent since the beginning of July. The S&P 500 seems to grow by more than 8% this month and the Dow Jones by more than 5%. Perhaps the market has already been overwhelmed by the recession as it has become a fact and possibly investors may already start thinking about the potential for improvement in economic performance. Additionally, American companies do not disappoint with their results as much as it could have been expected before, which may also positively affect the performance of indices overseas.