Business Maverick: Stocks Pare Gains After Powell Hints at Recession: Markets Wrap

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US stocks pared earlier gains after Federal Reserve Chair Jerome Powell reiterated his commitment to curb inflation during his congressional testimony and said that a recession could be a possibility.

The S&P 500 and the tech-heavy Nasdaq 100 rose, coming off earlier highs. Treasury yields declined with the 10-year yield hovering around 3.14%. The dollar fell after earlier gains while other safe haven assets like gold climbed.for its worst first half since Richard Nixon’s presidency as optimism evaporates that policy makers can achieve a soft landing as they navigate a course of aggressive monetary tightening to tame inflation.

“Such aggressive tightening will make a soft landing very difficult to engineer and those fears of recession or at least significantly slower growth are hitting demand for equities,” Fiona Cincotta, senior financial markets analyst at City Index, said in a note.The market continues to be skeptical about the outlook for risk assets.

How will the second half of this year play out for major asset classes? We are re-running MLIV’s 2022 asset survey from December to see how street views have evolved amid the turmoil and volatility in the past few months. Click

 

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