Latest news with #marketcorrection

Dubai property prices expected to fall by 15% on supply glut this year, Fitch says

The National

29-05-2025

Business
The National

Dubai property prices expected to fall by 15% on supply glut this year, Fitch says

The real estate market in Dubai is set to enter a "moderate correction' in the second half of 2025 because of a record number of project launches, Fitch Ratings has said. The correction – a phase in which price of an asset declines by 10 per cent or more – would run through 2026, but is not expected to exceed 15 per cent, as the strength of the prime real estate segment will support the rest of the market, the New York-based ratings agency said in a research note on Thursday. While corrections that can last from days to months or longer could devalue asset prices and value of investment portfolios in the short term, they are also an opportunity for buying new assets at lower values. Real estate prices in the emirate, the commercial and financial hub of the Middle East, have leapt by about 60 per cent from 2022 to the first quarter of 2025, Fitch data showed. The market has maintained a robust momentum after bouncing back from the Covid-driven slowdown and its world-beating run was supported by government measure including multiple visa options for investors and policy measures that boosted ease of doing business in the emirate. Over the past few years, there have been a record number of new property launches, which in turn will double unit deliveries in 2025 and 2026 compared to 2022 to 2024, "which could cause a price correction', analysts at Fitch said. "Assets in prime locations are more resilient to downturns and investor appetite for these assets, with longer investment horizons, should underpin their valuations. Delays in project completion might also alleviate pricing pressure,' Fitch said. However, the ratings agency expects that banks as well as developers will be able to "tolerate' falling real estate prices, with the former in particular having a "solid ability to tolerate risks', as banking sector exposure to property sectors fell to 14 per cent of total gross loans at the end of 2024, compared to 20 per cent at the end of 2021. Despite the reduction in lending portfolio exposure, real estate still remains the largest component of banks' loan books. However, "while a drop in prices could lead to a moderate rise in stage 2 and 3 loans ratios at some of rated banks, we do not expect a sector-wide asset quality deterioration', Fitch added. Homebuilders, on the other hand, remain well funded, giving them a buffer to withstand a price correction as they have "reduced execution risk and have favourable pre-sales models, supported by robust order backlogs', providing cash flow visibility, Fitch said. Sustained demand from a growing population and heightened investor interest are driving property sales in Dubai. The property market has also been benefiting from government initiatives, such as residency permits for retired and remote workers, expansion of the 10-year golden visa programme and overall growth in the UAE's economy on diversification efforts. Real estate prices in Dubai rose above their 2014 historical peak in early 2024 on high oil prices and regional political instability. Abu Dhabi's prices, meanwhile, rose by 21 per cent since the pandemic, although they remain below 2014 levels. Other emirates also recorded increases since the pandemic, but considerably less compared to Dubai. Dubai launched a record number of projects in 2024, resulting in a supply of an estimated 150,000 units, half more than 100,000 in 2023. Deliveries would spike in 2026, when about 120,000 units are planned for handover, compared to 30,000 in 2024 and 90,000 in 2025. "This rate of project delivery roll-out will test the absorption rate of the Dubai residential market in 2026–2027,' Fitch analysts said. While Fitch estimates a prices correction, Betterhomes among the biggest property brokerages in the emirate expects rising interest from buyers. The move to impose sweeping global tariffs by US President Donald Trump is unlikely to affect prices in the UAE real estate market, Betterhomes said a separate report. Interest is coming from US and Chinese investors, "signalling a renewed appetite for Dubai real estate as a stable and strategic investment destination', said Louis Harding, chief executive of Betterhomes. The sustained momentum of the emirates' economy, its strong tourism sector, high public spending and diversification efforts that continue to mitigate external risks, also add to the appeal of Dubai's property market, according to Betterhomes's report.

XRP Plunges Below $2.30 Amid Heavy Selling Pressure

Yahoo

25-05-2025

Business
Yahoo

XRP Plunges Below $2.30 Amid Heavy Selling Pressure

Global economic tensions are weighing heavily on cryptocurrency markets as XRP experiences a significant correction amid heavy selling pressure. The recent announcement of potential 50% tariffs on European Union imports by the US government has triggered widespread market uncertainty, with XRP falling alongside most major cryptocurrencies despite Bitcoin recently reaching new all-time highs. Technical analysts point to critical support at the $2.25-$2.26 range, with market watchers warning that a break below this level could trigger deeper corrections toward the $1.55-$1.90 zone. Meanwhile, institutional interest remains strong with Volatility Shares launching an XRP futures ETF and leveraged ETF inflows surging despite the price dip, suggesting Wall Street continues accumulating positions during market weakness. Technical Analysis Highlights XRP underwent a notable 3.46% correction over the 24-hour period, with price declining from $2.361 to $2.303, creating an overall range of $0.084 (3.57%). The most significant price action occurred during the midnight hour (00:00), when XRP plummeted to $2.297 on exceptionally high volume (37.1M), establishing a strong volume-based support zone. A secondary sell-off at 08:00 saw price touch the period low of $2.280 with the highest volume spike (39.9M), confirming a double-bottom formation. In the last hour, XRP experienced significant volatility with a recovery attempt following the earlier correction. After reaching a low of $2.297 at 13:11, price formed a base around $2.298 before staging a substantial rally beginning at 13:27, peaking at $2.307 at 13:36-13:39 with exceptionally high volume (627K-480K). This bullish momentum created a clear resistance zone at $2.307, which was tested multiple times. The final 15 minutes saw profit-taking pressure emerge, with price retracing to $2.300, establishing a short-term support level that aligns with the psychological $2.30 threshold. External References "XRP Price Watch: Consolidation or Collapse? Market Holds Breath Near $2.35", News, published May 24, 2025. "XRP Price Prediction For May 25", CoinPedia, published May 25, 2025. "XRP Risks Fall To $1.55 If This Support Level Fails – Analyst", NewsBTC, published May 25, 2025.

Yahoo

25-05-2025

Business
Yahoo

XRP Plunges Below $2.30 Amid Heavy Selling Pressure

Has The Stock Market Hit A Bottom In 2025?

Forbes

20-05-2025

Business
Forbes

Has The Stock Market Hit A Bottom In 2025?

The market has shown promising signs of bottoming, with sentiment reaching extreme pessimism and ... More valuations moderating to more reasonable levels. After a turbulent start to 2025, investors worldwide ask the million-dollar question: Have we finally reached the bottom of this market correction? The dramatic swings of the past few months have tested even the most steadfast investors, prompting many to wonder if now represents an opportunity or a trap. This analysis will examine the current market conditions, historical comparisons and expert opinions to determine whether this represents a market bottom or a pause before further decline. We'll also explore strategies savvy investors implement in these uncertain times. The first quarter of 2025 delivered one of the most jarring market corrections in recent memory, with major indices dropping between 12% and 18% from their December 2024 highs. The tech-heavy Nasdaq was hit particularly hard, shedding nearly 22% before a recent April rebound that recovered roughly half those losses. This swift decline, triggered initially by disappointing earnings reports from major tech companies and exacerbated by new tariff announcements, caught many investors off guard. While the bounce in April has renewed optimism, trading volumes remain concerning. Much of the recovery occurred on relatively low volume, a potential red flag for sustainability. The resulting market whiplash has created a deeply divided investment community. Bulls point to the sharp recovery as evidence that the worst is behind us, while bears view it as a classic bear market rally before the next leg down. A stock market bottom represents the lowest point of a market decline before a sustained recovery begins. Identifying true bottoms is notoriously difficult in real-time, as they typically become apparent only in retrospect. Classic signs include capitulation selling (where even long-term investors give up and sell), extreme negative sentiment readings, and valuations that reach historically low levels. Market bottoms often feature a spike in volatility, unusually high trading volumes and what analysts call "washout days"—sessions with overwhelmingly negative breadth in which 90% or more of stocks decline simultaneously. They frequently coincide with peak pessimism in investor sentiment surveys and mainstream financial media coverage, turning decidedly negative. Notably, true market bottoms don't necessarily require new catastrophic news to form—they often occur when bad news fails to drive prices lower, suggesting the market has fully absorbed negative factors. This "climax of bad news" phenomenon historically precedes meaningful recoveries. Several critical macroeconomic and geopolitical forces are shaping the current market environment, each exerting significant influence on investor behavior and market dynamics. Understanding these factors is essential for contextualizing recent market movements and evaluating whether we've reached a bottom. The Federal Reserve's aggressive pivot in 2025 has dramatically reshaped market expectations. After holding rates steady through most of 2024, the unexpected inflation surge in late December prompted the Fed to signal a potential return to rate hikes. This move shocked markets and triggered the initial selloff. The subsequent March meeting brought a more moderate tone from Fed officials, suggesting they might hold rates at current levels rather than raising them further. Despite uncertainty about their longer-term trajectory, this shift helped fuel the April recovery. The market is now pricing in two potential rate cuts for late 2025, but these expectations remain highly dependent on incoming inflation data. Inflation has proven stubbornly persistent in 2025, with the latest readings consistently exceeding analyst expectations. The Consumer Price Index has remained above 4% for three consecutive months, complicating the Federal Reserve's policy decisions and limiting its flexibility to support markets through monetary easing. The combination of sticky inflation and already-high interest rates has created a challenging environment for equity valuations, particularly for growth companies whose future cash flows become less valuable in high-rate environments. Many economists point to the unusual disconnect between tightening financial conditions and continued strength in consumer spending as a precarious balance that could ultimately lead to more significant economic deterioration. The expansion of tariffs announced in February 2025 sent shockwaves through global markets, particularly severely impacting technology, manufacturing and consumer goods sectors. These new trade measures, initially targeting several Asian economies but later expanded to include European imports, have disrupted supply chains and compressed profit margins for numerous multinational corporations. The latest quarterly earnings reports reveal companies struggling to pass these increased costs to consumers, resulting in profit warnings that have contributed significantly to market volatility. The uncertainty surrounding potential retaliatory measures from trading partners and the possibility of further escalation continues to hang over market sentiment like a sword of Damocles. The global economic picture has darkened considerably in early 2025. China's property sector woes have deepened despite government intervention attempts, while Europe teeters on the edge of recession amid energy concerns and manufacturing contraction. Emerging markets are struggling under the weight of dollar-denominated debt as the greenback strengthens. These international headwinds pose significant challenges for U.S. multinational corporations, many of which derive substantial portions of their revenue from overseas operations. The synchronized global slowdown raises legitimate concerns about corporate earnings sustainability through the remainder of 2025, even if domestic consumption remains relatively resilient. Investor psychology has undergone a remarkable transformation since the start of 2025. The unbridled optimism that characterized markets in late 2024 has given way to significant caution, with investor sentiment surveys reaching levels of pessimism typically associated with market bottoms. The American Association of Individual Investors (AAII) survey recently recorded its highest bearish reading since March 2020, while institutional investors have increased cash positions to the highest levels in nearly three years. This extreme negativity paradoxically serves as a contrarian indicator—historically, such pessimism often occurs near market bottoms when selling pressure has been exhausted. Historical market bottoms provide valuable context for evaluating our current situation. The 2020 COVID crash featured a sharp V-shaped recovery fueled by unprecedented monetary and fiscal stimulus, conditions notably absent today. Conversely, the 2008-2009 financial crisis produced a more protracted bottom-building process with multiple false starts before the sustained recovery began. The current market action resembles the 2000-2002 tech bubble deflation and the 2018 near-bear market, both characterized by valuation corrections rather than full-blown economic crises. In both cases, markets experienced significant relief rallies before ultimately testing or breaking their initial lows as economic fundamentals continued deteriorating. Most concerning for bulls, almost every primary bear market in the past century has featured at least one powerful countertrend rally exceeding 10% before reaching the ultimate bottom. These "bear market rallies" typically trap optimistic investors before resuming the downtrend—a pattern that raises caution flags about the sustainability of our recent bounce. Several compelling indicators suggest we have seen the worst of this correction. The breadth of the market decline reached an extreme in March, with nearly 90% of S&P 500 components trading below their 200-day moving averages—a level of oversold conditions typically seen near essential bottoms. Corporate insider buying spiked dramatically during the March lows, reaching the highest since early 2020. Historically, when executives put their capital to work purchasing their company shares, it often signals undervaluation. Unlike in the months prior, in the last two weeks, defensive sectors have underperformed cyclical sectors (such as consumer discretionary, industrials, energy, and financials), typically a reliable early indicator of market healing. The VIX volatility index, often called the market's "fear gauge," reached readings above 35 before declining—a pattern that has historically marked significant bottoms. This volatility compression, combined with stabilizing credit markets and narrowing high-yield bond spreads, suggests the acute phase of market stress may have passed. Despite these positive signals, several warning signs suggest this recovery could prove transitory. Trading volumes during the April rally have been consistently below average—healthy market bottoms typically feature strong participation and expanding volumes during the recovery phase, which has been notably absent. The market's concentration remains troubling, with much of the recovery driven by a small handful of large technology companies rather than broad-based participation. This narrow leadership historically represents an unstable foundation for sustained market advances and often precedes renewed weakness. Most worryingly, economic data continues to deteriorate beneath the surface. Housing starts have declined for three consecutive months, manufacturing surveys remain in contraction territory and initial jobless claims have begun ticking higher. These leading indicators historically turn down before major market declines and suggest the full economic impact of higher interest rates has yet to be fully realized. Wall Street strategists remain deeply divided about market prospects. Prominent bulls like an equity research team at JPMorgan argue that inflation has peaked and the Fed will pivot to supportive policies by year-end, creating a positive backdrop for equities. They view the recent correction as a healthy reset that has purged speculative excesses rather than the start of a deeper bear market. In contrast, Morgan Stanley's analysts caution that earnings estimates remain too optimistic given the challenging macroeconomic backdrop. Their models suggest S&P 500 companies could face 5-8% earnings declines in 2025, compared to the consensus expectation of 3% growth, creating significant downside risk if these negative revisions materialize. Independent economists like Nouriel Roubini warn that markets are underestimating the persistence of inflation and the Fed's resolve to bring it under control, even at the cost of higher unemployment and market pain. This camp believes the April rally represents a classic bear market trap that will ultimately give way to new lows as economic reality asserts. After weighing the evidence, we must conclude that while many typical bottom indicators have flashed positive signals, substantial risks remain that could easily trigger another leg lower. The current market environment resembles previous bear markets, where powerful rallies ultimately failed. The technical picture has undoubtedly improved, with major indices reclaiming key moving averages and momentum indicators turning positive. However, the fundamental backdrop—high inflation, restrictive monetary policy and deteriorating economic data—creates a precarious foundation for sustained market advances. Most concerning is the timing of this potential bottom relative to the economic cycle. Historically, markets typically bottom approximately 6-8 months before recessions end, not before they potentially begin. With leading economic indicators still deteriorating, the market may prematurely price in a distant recovery, setting the stage for disappointment if economic conditions worsen. Sophisticated investors approach the current environment with strategic caution rather than outright bearishness. Many are using the recent strength to rebalance portfolios, trimming positions that have recovered significantly while maintaining substantial cash reserves to deploy on any renewed weakness. Sector rotation has become a key focus, with many institutional investors reducing exposure to consumer discretionary and technology stocks while increasing allocations to healthcare, consumer staples and select energy companies—sectors that historically outperform during periods of economic uncertainty and persistent inflation. Alternative investments are also gaining traction, with increased allocations to strategies less correlated with traditional equity markets. Treasury Inflation-Protected Securities (TIPS), commodities and select real estate investments are utilized to create more resilient portfolios capable of weathering continued volatility. Investors should closely monitor several key indicators to determine whether this recovery sustains or falters. The most critical factor remains inflation data—if price pressures continue moderating, it would provide the Federal Reserve much-needed flexibility to ease monetary conditions later this year. Corporate earnings reports deserve heightened attention, particularly guidance about future quarters. Watch for companies' ability to maintain profit margins amid rising input costs and potential demand softening—widespread downward revisions to future earnings expectations would represent a significant red flag. Employment data will prove crucial in determining the economic trajectory. The labor market has remained remarkably resilient thus far. Still, any sustained increase in weekly jobless claims or deterioration in monthly payroll figures could signal the beginning of a more pronounced economic downturn that would likely pressure markets further. Bottom Line The market has shown promising signs of bottoming, with sentiment reaching extreme pessimism and valuations moderating to more reasonable levels. However, history suggests caution is warranted when powerful rallies emerge within challenging macroeconomic environments. The unprecedentedly high inflation, rising interest rates and growing economic uncertainty create a fragile foundation for sustained market advances. While we may have seen the worst initial panic selling, investors should remain prepared for continued volatility and possibly even lower lows before a durable recovery takes hold. Classic bottom indicators include extreme negative sentiment, capitulation selling with high volume, valuations reaching historical low, and institutional investors increasing equity allocations after building cash reserves. Rather than timing the market precisely, consider dollar-cost averaging into quality companies with strong balance sheets, gradually deploying capital while maintaining some reserves for potential further declines. Typically, financials, consumer discretionary and technology sectors lead the initial recovery phase, while defensive sectors like utilities and consumer staples often lag during the early stages of new bull markets. Effective hedging strategies include maintaining adequate cash reserves, diversifying across asset classes, implementing targeted options strategies and increasing exposure to historically resilient sectors like healthcare and consumer staples.

Forbes

09-05-2025

Business
Forbes

New Bull Market Or Bear Rally?

Historical Bull and Bear Setups The S&P 500 has had a strong rally from its April 7 intraday low of 4,835. As of intraday Thursday, May 8, the market has moved up towards 5,700 and is approaching its 200-Daily Moving Average (DMA) at 5,748. A move above the 200 DMA would be a bullish signal and increase the odds that a new bull run has begun. Given this, we think it is a good time to re-circulate our work on U.S. market corrections and bear market rallies. For historical purposes, we use the Dow Jones Industrial Average (DJIA) as our guidepost for market studies given the length of past data. Figure 1 shows all equity bear markets from 1970 to present. As seen in the top left corner of the chart, and represented by the blue line, the current percent from highs is only -8% after the recent rally. This is well below most past bear markets (at 105 days in) and raises the question if this is a true bear market or an unusually sharp correction within an ongoing bull market. The median percent down this far in is around 14%.Still, the trading sequence from highs is not that far off from the beginnings of bear markets, particularly 2000 and 2022. Figure 1: DJIA Bear Market Sequences William O'Neil + Co. But the case for a sharp correction and beginning of a new run is gaining momentum and appears to be the stronger one currently. Two cases where the deep correction led to lows being established fairly quickly and a new uptrend beginning were in 1998 and 2018. The Nasdaq's current trajectory has looked especially similar to these two periods. The key to continuing on this path will be further gains with no correction of 5% or greater. Figure 2/3: Comparison of Current Market to 2018 and 1998 William O'Neil + Co. William O'Neil + Co. See how the actual charts themselves compare in the next three pages. (3 charts) William O'Neil + Co. William O'Neil + Co. William O'Neil + Co. Below in Figure 4 are the averages and medians of bull market rallies and corrections, versus bear market correction and rallies. This considers a 'leg' of at least 5% in either direction as the minimum. Figure 4: Average/Median Rally/Corrections Legs, DJIA 1900-2025 William O'Neil + Co. As you can see below in Figure 5, and starting with the last clear bull market leg, the recent legs in both directions have been mixed to the point of almost being indistinguishable. The current up leg is up roughly +10% from the low on April 21, which is in-line with up legs occurring within bear markets. We remain hopeful that the current leg continues higher without a >5% correction and begins to look more like the typical bull leg. This would be roughly another 4% higher and would take the DJIA to above its 100-DMA and back to within about 5% of all-time highs. A >5% pullback from here would not be ideal, as it would represent a clear undercut of the 21-DMA, something that did not happen quickly in 1998 or 2018. See the initial legs from the lows in 1998 and 2018 at the bottom of the table. Figure 5: Recent Average/Median Rally/Corrections Legs William O'Neil + Co. While we are encouraged by the recent three weeks of positive market action, we are not yet convinced that the market has returned to a sustainable long-term uptrend. One factor that leaves us a bit worried is the breakdown of leading and lagging O'Neil Industry Groups. In general, when a new bull market emerges, we would like to see clearly defined growth stocks in areas like Technology, Health Care, and Consumer Discretionary at the top of the group rankings and not more defensive industries like Gold, Tobacco, Utility, and defensive Retail. The number of more defensive groups within the top 40 industries concerns us and we would like to see more growth industries move into this list. But the early signs of improvement are there. Security and Gaming Software, Fintech (Financial Services and Payments), and Internet Retail are fertile growth areas now within the top 40. Figure 6: Top and Bottom 40-Ranked Industry Groups William O'Neil + Co. Kenley Scott, Director, Global Sector Strategist at William O'Neil + Company, an affiliate of O'Neil Global Advisors, made significant contributions to the data compilation, analysis, and writing for this article.

Latest news with #marketcorrection

Dubai property prices expected to fall by 15% on supply glut this year, Fitch says

XRP Plunges Below $2.30 Amid Heavy Selling Pressure

XRP Plunges Below $2.30 Amid Heavy Selling Pressure

Has The Stock Market Hit A Bottom In 2025?

New Bull Market Or Bear Rally?

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