Has the Fed Pulled Off the Elusive Soft Landing?
Published On Sep 19, 2024, 8:13 AM
Global markets are experiencing a rally following an unexpected interest rate cut of half a percentage point by the Federal Reserve. This significant decrease has revived investor confidence, as reflected in the rise of S&P 500 futures, bonds, and cryptocurrencies. The Fed's aim for the cut was to support household finances and strengthen the labor market, with expectations of further rate reductions in the near future. While some political figures have expressed skepticism regarding the Fed's timing and motives, many see this move as a step towards preventing a recession and facilitating economic growth.
Stock Forecasts
XLF
Positive
The unexpected large interest rate cut by the Fed could boost consumer spending and improve market sentiment, likely benefiting financial institutions and consumer-related stocks.
XHB
Positive
With lower borrowing costs anticipated, sectors such as real estate could experience growth as mortgage rates may decline, bolstering home sales and housing-related equities.
VXX
Negative
Volatility in the market may still pose risks, especially for sectors sensitive to interest rate changes; however, the short-term sentiment appears optimistic following the Fed's decision.
Related News
A Trump Fix for the Housing Crisis Could Actually Make It Worse
Oct 11, 2024, 12:01 PM
The former president often implies that deportations will bring down housing costs. Reality is more complicated.
JPMorgan touts 'soft landing' possibility after better-than-feared earnings
Oct 11, 2024, 11:03 AM
Profits at JPMorgan and Wells Fargo both fell from the year-ago period, but those declines were less than what analysts expected.
Stock market today: Stocks rise amid big bank earnings, inflation data
Oct 11, 2024, 10:21 AM
JPMorgan and Wells Fargo get earnings season going in earnest while a wholesale inflation print is in focus after the CPI surprise.