Thursday, July 28, 2022

US Market Wrap 07/28/2022

 - The stock rally gained traction, defying sceptics in the aftermath of the Fed decision, with traders reducing bets on rate hikes as the drumbeat of recession grew louder amid poor economic data.

- Equities reached a seven-week high, led by defensive groups, which are frequently sought after during difficult times. Prior to the results of Apple and Amazon,  technology underperformed. Bond yields fell, and swaps referencing policy meeting dates showed bets that the fed funds rate will peak around 3.25% before the end of 2022, less than 100 basis points higher than it is now.

- Investors remained bullish on the Fed slowing its rate of tightening as data indicated the economy was losing steam heading into the second half of the year. That came a day after Jerome Powell said hikes would slow at some point, sparking a strong market reaction that was slammed by Fed watchers who said traders got it all wrong because tighter financial conditions are needed to combat inflation.