This might bring about a question in most investors‘ minds: if the recent CPI numbers exceeded market consensus, what might be the reason for the rally going on since that has carried over into this week (so far)? There are two attributable reasons:

1. Given that this week is full of Q3 earnings releases, there will be some churn in volumes, usually bullish. There is a nearly even expectation that this optimism would peter out by the end of the month.
2. If the „short profit-scalpers are switching from „single names“ to „index products“, so are investors in the „long“. Since ETF issuers have to physically hold the underlying, there is some momentum being imparted as they buy up the stocks to create new ETF units, which is imparting a type of „false positive“ in a bear market.

Overall, the trends of the current week might not be the upswing many investors are hoping for.

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