In this week’s market review, we examine the curious relationship between updated economic data, and the markets. And I conclude, Up is Down. We start with the US markets, look across Europe and Asia, and end in Australia, as well as covering the latest in Oil and Metals, and a quick look at Crypto.
It appears equity traders have apparently gotten bored waiting for higher interest rates to make their presence known in the economy despite increasingly thorny warnings from the Federal Reserve, and the shockingly frank revelation from the Bank of England on Thursday that Recession is coming. The focus rather has been on celebrating buoyant earnings and economic reports. The S&P 500’s performance over the last five days was virtually flat compared with the previous two weeks.
The central bank is “nowhere near” being almost done cracking down on inflation, San Francisco’s Mary Daly said. Cleveland’s Loretta Mester is looking for persuasive evidence price pressures are moderating and Chicago’s Charles Evans said policy makers were a few reports away from seeing the kind of data that would make them think they’re on the right track.
“The market is basically saying to the Fed, ‘You’re not going to have to go as far as you think you do,’ and also, ‘You might have to start reversing course much sooner than you think you have to,’” Katie Nixon, chief investment officer at Northern Trust Wealth Management, said “Is it sustainable in the face of a Fed that appears to be hell-bent on not stopping not stopping?”
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