Ark Invest chief executive Cathie Wood believes stocks are poised to rise as price pressures ease and interest rates fall on the horizon. “The bull market in equities expanded sharply in the fourth quarter as the Fed’s dot plot began to show a sharp decline in interest rates,” Wood said in an X post late Thursday. “So far this year, the opposite has been true. In our view, more Price deflation and lower rates will activate coil stocks.” The innovation-focused investor has been calling for deflation since mid-2022, when the Fed was still in the midst of an aggressive tightening cycle to combat inflation. middle. She noted at the time that inflation was caused by temporary inventory problems caused by the epidemic. There have been some signs of gradual progress in inflation recently, with April’s consumer price index showing inflation at an annual rate of 3.4%, slightly below March levels. Excluding food and energy, core CPI was 3.6%, the lowest level since April 2021. Her flagship Ark Innovation ETF is down 67% in 2022. She said investors were flocking to safe havens and cash at a rate as dramatic as the 1930s. “We believe the search for cash and safety in today’s stock market is as strong as it was during the Great Depression of the early 1930s,” Wood said in the X-Post. “When fear dissipates, markets widen and reward risk-taking again.”
