Stocks finished slightly higher on Monday, attempting to find their footing after last week’s brutal selloff, but Wall Street experts warn that even after the market’s worst month since the onset of the coronavirus pandemic in March 2020, investors should be wary of more volatility ahead.
Stocks inched higher on Monday, notching slight gains after trading in negative territory for most of the session: The Dow Jones Industrial Average rose 0.3%, nearly 100 points, while the S&P 500 gained 0.6% and the tech-heavy Nasdaq Composite 1.6%.
Despite the modest rebound from a brutal selloff last week, which culminated with the Dow plunging 900 points on Friday, Wall Street experts are now warning investors that market uncertainty will continue.
The Dow and S&P 500 both closed out their worst month since March 2020 last week, down 4.9% and 8.8%, respectively, while the Nasdaq posted its worst month since 2008, falling over 13%.
The recent “equity collapse” has dealt a “brutal blow” to investor sentiment and it will take “some time for the psychological damage to heal,” says Vital Knowledge founder Adam Crisafulli, who adds, “No one is rushing aggressively to buy the dip.”
Amid the tech-driven market selloff in April, “it’s all but guaranteed that we’re likely to see continued volatility” going into May, according to a recent note from Bespoke Investment Group.
The “especially vicious” stock market selloff likely isn’t over, Morgan Stanley analyst Michael Wilson warned on Monday, predicting the S&P 500 could fall another 8% amid ongoing fears about a slowdown in US economic growth.