Volkswagen stock begins a rebound along with the broader stock market
Volkswagen stock price is beginning to rebound along with its automotive peers. Cyclical stocks have been recovering since Thursday thanks to the clear revival of investors’ appetite for risk after the reassuring results of Nvidia (+5.2%), but above all of American retailers Macy’s (+19.3%), Williams Sonoma ( +13.1%) and Dollar General (+13.7%).
These retail companies beat expectations in the first quarter, and the last two even raised their forecasts for the year, helping to ease recession fears heightened by disappointing results from Walmart and Target last week. Naturally, risky markets benefit, including cyclicals, although retailers are not one of them.
The announcement that the Chinese authorities would subsidize vehicle purchases by the private sector in order to support the economy was also likely to be a support for the auto sector on Thursday.
Over 80% of volume on the NYSE was bullish for the second straight session on Thursday, which is an important bullish signal for all Western stock markets. Indeed, the end of bear markets have very often been followed by such significant bullish volumes (for two sessions), or greater than 90% during one session.
Obviously, the Holy Grail does not exist on the markets and this signal could occur without signaling the end of the correction on the markets. Nevertheless, this technical signal comes in a very pessimistic context, with investor opinion surveys at their lowest and after seven consecutive weeks of decline… In such a context, the risk/return ratio seems to me rather in favor of the buying than selling.
Volkswagen stock price daily chart – key levels