Strap in as markets twist, turn, and dip with every headline—are we in for a thrill or a tumble? In this episode, Scott Bauer joins us live from the trading floor to break down the wild ride investors are facing right now.
Summary – IBKR Podcasts Ep. 250
The following is a summary of a live audio recording and may contain errors in spelling or grammar. Although IBKR has edited for clarity no material changes have been made.
Jeff Praissman
Hi everyone. This is Jeff Praissman with Interactive Brokers. It’s my pleasure to welcome Scott Bauer, CEO of Prosper Trading Academy. Hey, Scott, how are you?
Scott Bauer
Thanks for having me back, Jeff. I am great. How are you?
Jeff Praissman
I’m good. I’m good. And Scott, with the holiday this past Friday, we had a shortened trading week last week, but the markets have certainly been pretty active over the past few days—and really up until yesterday—trending downward. Do you think there’s another rally in our future, like we got, you know, with the 90-day pause in the tariffs and yesterday’s news on potentially cutting the tariffs on China? Or will the markets continue to slide?
Scott Bauer
I think overall the sentiment is still bearish. I think the sentiment is still “sell rallies,” and, you know, again, we’ve talked about this, Jeff—we’ve never really been in this market environment before, where kind of the technicals and fundamentals are almost pushed away to the side a little bit, and the market is really just reacting and trading to the news flow—to a tweet. So I do think overall, for now, I think we have to be a bit cautious. That’s just my opinion.
Jeff Praissman
To add to all this, we’re actually in the middle of earnings season as well. How much of this market movement is earnings-related? How much do you think is just general economic outlook? Or is it just, you know, like you said, headline-related at this point?
Scott Bauer
I’ve really never seen a time like this where I really, truly believe it is all headline-related. Sure, we’ve got individual earnings that are coming out, and that individual stock—let’s say, whether it’s an IBM, Texas Instruments—you know, those move just, you know, pretty large. Those stocks are moving based on their earnings reports, not really affecting the overall market, though. I really think that the sentiment in the marketplace on a minute-by-minute, day-to-day basis is really: What is the last piece of news that we got?
Jeff Praissman
And then kind of pivoting a little bit and kind of going more into an economic outlook—what do you think the effect of the weakening dollar is on the market?
Scott Bauer
Boy, it’s definitely concerning. There’s no question about it. I think it kind of funnels into the whole theme of—and this is not me—but the quote-unquote “Sell America” theme out there, which I don’t subscribe to. I don’t buy into that, but I do think that has added to the negative sentiment overall, at least on the retail side of things. On the institutional side, that might be different, but, you know, nobody really likes to see the dollar down here, and all that does is drag down sentiment.
Jeff Praissman
And do you think an interest cut by the FOMC would have any positive impact at this stage?
Scott Bauer
That’s a real tough one, because if we do wind up getting a cut—whether it may be at the June meeting, the July meeting—I think May is probably off the table at this point. If we do wind up getting a cut, it does mean because they see things really slowing down. So there’s definitely a double-edged sword there.
Sure, everybody wants to see rates lower. We don’t want to see rates lower because we’re kind of all backing up and the economy is getting worse. So I really think it’s a double-edged sword. In the long run, it probably helps the market, but I really think the initial reaction could be negative.
Jeff Praissman
Scott, this was great. Thanks for joining us live from the floor of the CIBO. For more from Scott, you can visit prospertrading.com. And I’m Jeff Praissman with Interactive Brokers. Thank you.
Scott Bauer
Thanks a lot, Jeff.
Disclosure: Interactive Brokers
The analysis in this material is provided for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation by IBKR to buy, sell or hold such investments. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.
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