the stock market bounce in recent days is just a relief rally and investors should avoid getting sucked back in according to trevor greetham head of multiasset at royal london asset management the positive momentum for global stocks looked set to continue on monday after the dow jones industrial average climbed 27 on friday and both the sp 500 and nasdaq composite added more than 3 the paneuropean stoxx 600 index meanwhile jumped by 26 on friday its best day for more than three months and continued its rise on monday however greetham from royal london which had over 200 billion in assets under management at the end of 2021 is far from convinced that a downward trend is over we still think were in a bear market and we think that this is as you describe it a relief rally and what weve seen so far is just the interest ratedriven part of that bear market greetham told cnbcs squawk box europe on monday highlighting that a fall in commodity prices had likely eased expectations for central bank interest rate hike requirements the sp 500 is still down almost 18 yeartodate while the stoxx 600 had shed around 15 by midafternoon in europe on monday in terms of the duration of the bear market greetham suggested investors look to other central bankinspired bear markets such as the 200709 financial crisis the early 2000s after the dotcom bubble burst and the early 90s you had two or threeyear bear markets in stocks and weve had six months so far so earnings are the next problem central banks do need to squeeze inflation down and that means creating spare capacity and this could be quite a long grinding period he said all the biggest up days are in bear markets so dont get too sucked back into markets i would say this rally could persist a bit longer but dont think this is the end of the bear market – i think theres quite a bit more time to run through and youve got to be tactical and youve got to be diversified another possible source of market relief last week came from the university of michigans surveys of consumers which showed that consumers expect inflation to rise at a 53 annualized rate as of the end of june down from a preliminary reading released earlier this month central banks across major economies have begun sharp rate hiking cycles in a bid to rein in inflation running at multidecade highs prompting speculation that aggressive monetary policy tightening could tip an already slowing economy into recession greetham agreed that inflation in the us will begin to come down soon as a result of the federal reserves policy tightening and longerterm commitment to temper consumer price increases however he reiterated that the second phase of the bear market is yet to come weve been in stagflation with a slowdown and rising inflation but we think were going to continue to be in slowdown as inflation comes down because central banks are going to need it to come down a long way he said so policy will be held quite tight rates will go quite a lot higher even if inflation is coming down and thats a problem for stocks because when you look at prior recessions stock markets havent usually properly troughed out until the unemployment rate has peaked greetham pointed out that the us jobs markets remains relatively strong suggesting that it could be another year or possibly two before a sustained recovery begins to form however he said it was understandable that the market had seized on the better inflation figures during the transition period between the phase one interest rate bear market and phase two earnings bear market