S&P 500: The S&P 500 is Gaining Bullish Momentum as the Fed Funds Rate Approaches the Terminal Rate






The S&P 500 closed just below 4,000 on Fri, after the CPI annual rate came in at 6.5%, the lowest level in more than a year and down from the 40-year peak of 9.1% last summer. The next key resistance level for the S&P 500 is 4,115. 

HSBC expects the Fed's final rate hike to be 50 bps on Feb 1 to a range of 4.75%-5.00%, and cuts at next year's meetings, according to a Reuters report. In our view, the 2-year U.S. Treasury yield could have peaked in November at 4.72%.

“The market does not believe the Fed’s insistence that they will actually go above 5% and stay there for an extended period. This is best reflected in the U.S. 2-year yield,…which is as low as it’s been since early October ’22, many Fed rate increases ago,” said Louis Navellier, founder and president of Navellier & Associates, in a note - MarketWatch.

This note contained herein is not and should not be construed as a recommendation to buy or sell. Click here to view the latest update!




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