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Markets Could See Rally if Recession is Delayed to 2024 After Fed Pauses Rate Hikes

  • Entering 2023's fourth quarter, markets may rally if recession is 'punted' to 2024 following Fed's rate pause and September volatility

  • Key Advisors Wealth CEO Eddie Ghabour says funds could flow into equities, spurring a Santa Claus rally

  • Ghabour expects October volatility with Fed noise, but markets could rally late 2022 if that's navigated

  • Ghabour Likelihood of year-end rally is high if Fed actions are digested and volatility clears

  • Full analysis on potential year-end market rally amid inflation and recession concerns on latest Yahoo Finance Live episode

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A stock market rally is likely to occur in the near future, as recent data indicates that a bounce is expected after a period of selling pressure, with several sectors and markets reaching oversold levels and trading below their normal risk ranges. Additionally, analysis suggests that sectors such as Utilities, Consumer Staples, Real Estate, Financials, and Bonds, which have been underperforming, could provide upside potential in 2024 if there is a decline in interest rates driven by the Federal Reserve.
Despite recent market gains, investors are concerned that the current rally may be the last hurrah before an economic contraction, especially after the Federal Reserve indicated that it could hike interest rates twice more this year.
The S&P 500 has rallied in 2023 due to factors such as cooling inflation, a strong economy, and a positive outlook for earnings, but concerns over credit market volatility, monetary policy uncertainty, and steep valuations pose risks to the bull market rally.
A potential relief rally in the stock market is expected to start the week, but the upside is limited due to uncertainties about interest rates and the recent volatility, according to a Wall Street technician. The S&P 500 and Nasdaq Composite have experienced pullbacks, but a relief rally may be possible in the near term. However, the long-term trend remains uncertain, and the risk of a downturn in the financial system is elevated.
The stock market rallied on Tuesday as job openings fell more than expected, with major indexes surpassing their 50-day moving averages and growth stocks performing well.
Stocks are expected to rally next month, with the S&P 500 potentially reaching its previous highs, according to Fundstrat's Tom Lee, who cited reasons such as a cooling economy, no further interest rate hikes from the Fed, overly bearish sentiment in August, and historically strong performance in September.
U.S. stock investors are closely watching next week's inflation data, which may determine the future of the equity rally, as signs of a soft landing for the U.S. economy have contributed to the S&P 500's gains, but too high inflation could lead to fears of higher interest rates and stock sell-offs.
The S&P 500 index has seen impressive gains this year, but one expert believes the rally is coming to an end, citing rising bond yields as the main threat to stock prices.
Investors attempt a risk-on rally as Treasury yields and oil prices stabilize, but concerns over higher interest rates continue to impact sentiment in European and global markets.
Market veteran Ed Yardeni predicts a year-end rally in the stock market, driven by strong corporate earnings and resilient economic growth, despite potential risks from higher interest rates.
Jim Cramer anticipates a potential stock market rally based on Friday's upcoming nonfarm payroll report, which may influence the Federal Reserve’s decision on interest rates and potentially please the market, although weakness in certain sectors is expected.
The stock market is poised for a relief rally, as several internal indicators have hit oversold extremes after a period of panic selling, according to Fairlead Strategies' Katie Stockton.
Wall Street rallies as investors analyze strong US job market report, though concerns about inflation and high interest rates persist.
The stock market rally ended the week on a bullish note, with major indexes staging an upside reversal and several leading stocks flashing buy signals, including Nvidia, Meta Platforms, Arista Networks, Qualys, Eli Lilly, CME Group, Vertiv Holdings, CrowdStrike Holdings, Cadence Design Systems, and Palo Alto Networks.
Market veteran Ed Yardeni forecasts that stocks could rally in the last stretch of the year due to the Fed's likely halt in interest rate hikes and strong corporate earnings, potentially leading to a year-end Santa Claus rally.
A rally in the S&P 500 in the fourth quarter of 2023 is more likely than not, according to Morgan Stanley's Michael Wilson, as investors maintain confidence in current levels despite concerns about interest rates and economic growth.
Mike Wilson, Morgan Stanley's top equity chief, predicts that the chances of a year-end stock market rally are diminishing as weak market breadth, declining earnings revisions, and a decline in consumer confidence weigh on the market.
The stock market rally faces further losses as volatility increases and the 10-year Treasury yield reaches almost 5%, but there is hope for a bounce as market fear gauges rise; Tesla plunges in volume due to weak earnings and a lack of growth, while stocks like Adobe, Arista Networks, Microsoft, Palantir Technologies, and Meta Platforms are worth watching for potential buying opportunities.
The stock market rally faces increasing pressure due to rising Treasury yields and disappointing earnings reactions, including Tesla, J.B. Hunt, Morgan Stanley, Intuitive Surgical, Terex, and United Airlines, while crude oil futures rose amidst Mideast tensions.
Treasuries rally as investors question the economy's ability to withstand current interest rates and higher borrowing costs, leading to a surge in yields.