Rate Cut Expectations Fuel Wall Street’s Rally: The U.S. financial markets have recently experienced a wave of gains,
reflecting the prevailing optimism among investors.
These gains come amid strong expectations that the Federal Reserve will soon begin cutting interest rates,
supporting the continued rise of stock indices on Wall Street.

Contents:

Continuous Rise of Stock Indices

Sustained Positive Momentum for Stocks

Anticipation of the Federal Reserve Meeting

A Pivotal Moment in September

Future Stock Market Expectations

Rate Cut Cycles and Stock Performance

Continuous Rise of Stock Indices

U.S. stock indices have continued to record consecutive gains,
with the S&P 500 rising for the eighth consecutive day, marking the longest winning streak of 2024.
This rise has been fueled by expectations that the Federal Reserve
might hint at its readiness to lower interest rates in upcoming meetings.

All major groups within the S&P 500 showed notable increases, with technology stocks leading the gains.
Interestingly, an equal-weight version of the index gave companies like Target the same influence as Microsoft,

contributing to the index reaching its highest level ever.
At the same time, the Russell 2000 index of small-cap companies added 1.2% to its value.

Sustained Positive Momentum for Stocks

Despite the market volatility in July and August, investor enthusiasm for stocks has not waned.
The momentum of trading and stock buybacks continued to push U.S. indices higher in the coming weeks.
According to Goldman Sachs, the pain in stock trading remains high,
driving investors to remain optimistic in a favorable environment.

Anticipation of the Federal Reserve Meeting

As the Federal Reserve meeting in Jackson Hole approaches, investors eagerly await the outcomes of the gathering.
Everyone is keen to know how prepared the Federal Reserve is to cut interest rates and what the future holds.
Some analysts have expressed that the Fed is unlikely to outpace market expectations,
but stocks are expected to hold up as long as economic growth remains strong.

A Pivotal Moment in September

Some, like Neil Dutta from Renaissance Macro Research, expect the Federal Reserve to cut interest rates in September.
However, the question remains as to the size of this cut.
Dutta believes that Jerome Powell is unlikely to dismiss the idea entirely
but may acknowledge a significant shift in the balance of risks since June.

Future Stock Market Expectations

Experts predict that macroeconomic data will determine the course of stocks in the coming weeks,
culminating in the August jobs report. Despite optimistic forecasts,
there are concerns about a potential economic slowdown,
which could reignite debates about the possibility of a recession.

Rate Cut Cycles and Stock Performance

Analyses have shown that growth stocks tend to outperform value stocks during previous rate-cutting cycles,
but their declines were more significant. Defensive sectors outperformed cyclical ones,
with consumer staples, healthcare, and communications stocks performing best.

In the end, investors constantly anticipate the economic and political developments in the coming days,

which could significantly impact financial markets.

Rate Cut Expectations Fuel Wall Street’s Rally

Rate Cut Expectations Fuel Wall Street&#8217;s Rally

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Rate Cut Expectations Fuel Wall Street’s Rally