Investors had a lot of headwinds to contend with in the week just passed, from hotter-than-expected readings from two of the three closely followed monthly inflation reports, to a United Auto Workers (UAW) strike at key plants for each of the three US automakers, and the growing likelihood of a US government shutdown by month end, notes Sam Stovall, chief investment strategist at CFRA Research.

A plethora of economic and geopolitical challenges to the health of this baby bull market, such as a soaring 10-year bond yield, an increasing likelihood of additional rate hikes, and a potential economic crisis in China, just caused global equity markets to experience an accelerated attempt to lock in gains from the recent nine-month advance. However, we don’t think this is the beginning of the end of the nascent bull market, writes Sam Stovall, chief investment strategist at CFRA Research.

Investors were pleasantly surprised last week by the better-than-expected readings for the Consumer Price Index (CPI) and Producer Price Index (PPI) for June on both the headline and core levels. They elevated optimism for the end-of-month Personal Consumption Expenditures (PCE) report, the Fed’s favorite inflation gauge, writes Sam Stovall, chief investment strategist at CFRA Research.

Despite ongoing uncertainty surrounding a possible recession, exacerbated by a still hawkish-sounding Fed, an earnings recession, narrow S&P 500 leadership, and an array of steeply inverted yield curves, the equity markets continue to climb a wall of worry, notes Sam Stovall, chief investment strategist at CFRA Research.