Next federal reserve meeting 20232/4/2024 “If the market took it as it is particularly hawkish, that would definitely be an excuse to see a bit of a sell-off here,” El Nokali said. He adds that there are still some factors that could help drive stocks higher next week, such as cool inflation prints or more dovish commentary from Fed Chair Jerome Powell at the post-meeting press conference.īut that also means Fed talk that hints at further tightening could dampen the market’s rally. Futures traders see a 53% chance of a July hike, though there’s also a roughly 31% chance of a pause that month, as of Friday afternoon.īecause the Fed has made its intentions clear, the rate decision itself is unlikely to move markets, says Karim El Nokali, investment strategist at Schroders. That’s different from a pause, since it suggests that the central bank could raise rates as soon as July after taking a break this month. That’s because Fed officials have indicated that they are likely to skip a hike in June. “Unless that number is wildly away from expectations, I don’t think the Fed changes their minds on anything,” said JJ Kinahan, chief executive of IG North America. While these readings, particularly the CPI, are generally seen as key indicators for how the data-dependent central bank will shape its monetary policy, investors are less concerned about how they will impact the Fed’s rate decision this time around. The May Consumer Price Index and Producer Price Index reports, two key inflation prints, are also due the days that the Fed meets. Markets see a roughly 71% probability of a pause, according to the CME FedWatch Tool as of Friday afternoon. The stock market’s next test will be the Fed’s meeting on June 13 and June 14. CNN’s Fear and Greed Index reached “extreme greed” on Thursday. The Cboe Volatility Index, or VIX, last Thursday closed at its lowest level since January 2020. Moreover, investors appeared calmer than they have in years, after the United States suspended the debt ceiling in time to avoid a default, allowing investors to breathe a sigh of relief. The Nasdaq Composite saw its longest streak of weekly gains since November 2019, powered by mega-cap tech stocks that have led the market higher in 2023. The S&P 500 Index last week entered a bull market, meaning that it notched a 20% rally from its low in October. Stocks have just come off a seemingly auspicious week - but could the Federal Reserve’s June meeting dampen the rally?
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