Stocks have struggled of late as rising yields around the globe, elevated oil prices, sticky inflation and a decline in memory names weighed on sentiment. Yet, Deutsche Bank is telling its clients to continue buying the dip. The S & P 500 and Nasdaq Composite fell for a second straight day on Monday. Micron and Seagate Technologies dragged memory stocks lower, losing 6% and 6.9%, respectively. Meanwhile, oil remained above $100 per barrel, while the 30-year Treasury bond yield traded near levels not seen in a year. A bearish cocktail such as this could spell the end for bull runs in stocks. Even some of Wall Street’s biggest bulls are growing cautious . But Deutsche Bank strategist Henry Allen still sees this as a buy-the-dip market. “Risk assets are still showing resilience. The S & P 500 is just 1.3% beneath its record,” Allen wrote to clients. “So even though the last couple of sessions have seen a slight pullback for risk assets, none of the conditions are in place that led to more aggressive selloffs in the past.” .SPX 3M bar SPX 3-mo He noted that, while oil remains high, the crude futures market still points to lower prices over the next year. The West Texas Intermediate futures contract expiring January 2027 is trading around $80 per barrel, per FactSet. On top of that, major central banks haven’t begun raising rates yet. “And even the tightening priced is minimal compared to past oil shocks like the 1970s and 2022,” he said, adding that global economic data remains strong despite the recent spate of inflation figures. “So unless we see a clear change in these fundamentals, then the resiliency of risk assets is not particularly remarkable, but is in keeping with the historical record of recent decades,” Allen wrote.
