Economic contraction for two consecutive quarters due to high inflation and aggressive policy tightening make many analysts believe that a recession is unavoidable. However, better-than-expected corporate earnings and an expansion of the services sector at an accelerated rate in June are expected to offset the impact of fears over a potential recession on the market.
The sector’s activity, which accounts for 80% of GDP growth, expanded in June for the 26th month in a row. The stock market responded positively to the favorable economic data.
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