Stock Market Ends Losing Streak. Why You Can Thank the Fed.

It isn’t elegant, graceful, or refined. And it apparently contradicts the past 10 days’ employment and inflation data, which would seem to support an increase in the federal-funds rate in November or December. But Federal Reserve officials have gone out of their way to talk down the likelihood of another hike, largely because the bond market has been doing the central bank’s work for it.

The S&P 500 index ended the week up 0.45%, the Dow Jones Industrial Average added 0.79%, and the Nasdaq Composite slipped 0.18%. The 10-year yield fell 0.16 point, to 4.63%. “I will remain cognizant of the tightening in financial conditions through higher bond yields and will keep that in mind as I assess the future path of policy,” Fed Vice Chair Philip Jefferson said on Monday, while Dallas Fed President Lorie Logan echoed that sentiment in separate remarks that same day. Atlanta Fed President Raphael Bostic cut straight to the point on Tuesday morning. “I don’t think we need to increase rates anymore,” he said. It doesn’t get any clearer than that.

The market, too, is coming around to that point of view. Interest-rate futures pricing now implies a less than one-in-three chance of an additional fed-funds increase this year, according to the CME FedWatch Tool, down from roughly 50/50 odds a few weeks ago. But that doesn’t mean they’ll come down quickly, either, even if the market is pricing in cuts of 0.75 percentage point next year. “The higher-for-longer idea is real,” Porcelli says.

Business Business Latest News, Business Business Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Stock Market Ends Losing Streak. Why You Can Thank the Fed.The central bank seems to have woken up to the potential impact of higher bond yields.
Source: MarketWatch - 🏆 3. / 97 Read more »

Stock Market Ends Losing Streak. Why You Can Thank the Fed.The central bank seems to have woken up to the potential impact of higher bond yields.
Source: MarketWatch - 🏆 3. / 97 Read more »

Why Treasurys could give the U.S. stock market a green light for a year-end rallyThe Fed will not drop its ‘higher-for-longer’ interest rate narrative until it sees cracks on the consumer side of the market, says Thierry Wizman of Macquarie
Source: MarketWatch - 🏆 3. / 97 Read more »

Here are 3 things to watch in the stock market after a very difficult weekNext week features tons of Fed speak, key economic data, and two more earnings reports from Club stocks.
Source: CNBC - 🏆 12. / 72 Read more »

GameStop Corp. Cl A stock falls Friday, underperforms marketSupported by world-class markets data from Dow Jones and FactSet, and partnering with Automated Insights, MarketWatch Automation brings you the latest, most pertinent content at record speed and with unparalleled accuracy.
Source: MarketWatch - 🏆 3. / 97 Read more »