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

  • 📰 MarketWatch
  • ⏱ Reading Time:
  • 57 sec. here
  • 2 min. at publisher
  • 📊 Quality Score:
  • News: 26%
  • Publisher: 97%

United States News News

United States United States Latest News,United States United States Headlines

The central bank seems to have woken up to the potential impact of higher bond yields.

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.

 

Thank you for your comment. Your comment will be published after being reviewed.
Please try again later.
We have summarized this news so that you can read it quickly. If you are interested in the news, you can read the full text here. Read more:

 /  🏆 3. in US

United States United States Latest News, United States United States Headlines

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

Stock market today: Asian markets slip as rising yields in the bond market pressure stocksShares have fallen in Asia after a retreat on Wall Street as the vise tightened from rising yields in the bond market. Hong Kong's benchmark dropped more than 2% as investors were disappointed by the latest Chinese economic data. U.S. futures edged higher and oil prices advanced. On Thursday, the S&P 500 lost 0.6% and the Dow shed 0.5%.
Source: AP - 🏆 728. / 51 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 »

NZD/USD Price Analysis: Extends losing spell to near 0.5900 on cautious market moodThe NZD/USD pair continued its bearish spell for the third trading session as fears of a slowdown in China rose after a poor inflation report. The Kiw
Source: FXStreetNews - 🏆 14. / 72 Read more »

Stock Market Today: Stocks slip as inflation fears, oil surge, hit sentimentRenewed inflation concerns, surging oil prices and the start of the third quarter earnings season have stocks in the red in early Friday trading.
Source: startelegram - 🏆 248. / 63 Read more »

Stock Market Today: JPMorgan, Wells Fargo Earnings OutOil prices rally, boosting energy companies
Source: WSJ - 🏆 98. / 63 Read more »

China’s Economy Is Improving but the Stock Market Says It’s Not Fast EnoughAnother round of grim Chinese economic data, another day of declines for China-exposed stocks. Imports, exports, and inflation paint a gloomy picture.
Source: MarketWatch - 🏆 3. / 97 Read more »