Stocks Keep Rolling As Fed Considers Rate Cuts

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Stocks,Fed,Interest Rates

Despite high valuations, the stock market continues to reach new highs as investors anticipate future interest rate cuts from the Federal Reserve. However, experts caution that these gains may be driven by short-term factors and suggest a more cautious approach for long-term investments.

) are rolling strong, continuing to hit all-time highs in the fourth quarter as the Federal Reserve considers future interest rate cuts."That should provide a little bit of a tailwind going forward. And that's really what's been boosting equities... day after day it seems like," NFJ Investment Group managing director and senior portfolio manager Burns McKinney tells Yahoo Finance."As I noted, you don't want to fight the Fed.

And so with the fed cutting interest rates that should provide a little bit of a tailwind going forward.Um you know, day after day, it seems like a tailwind for which sectors from your purview.Um you know, in fact, if anything, what we're seeing is because uh the economy has proven itself to be somewhat resilient.

You have uh you still have a lot of dollars uh going out the or for the uh the infrastructure spending programs and uh just really just the, the re industrialization of the United States provides a bit of a tailwind for some of those industrial names, you know, just, just further down the line of what you were mentioning a moment ago with utilities.Considering the fact that we're taking a look at XL U here, even utility sector for the S and P 500 it's up 26 27% year to date here.

Whereas, you know, over the last couple of decades, the average earnings growth has only been eight or 9%.So, in many ways, um, that is priced for perfection.

 

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