In the latest LPL Market Signals podcast, LPL strategists discuss the S&P 500 Index’s rebound back to near record highs and highlight several key takeaways from the Federal Reserve’s meeting last week in Jackson Hole, WY.
Stocks enjoyed a solid week last week as markets celebrated the Federal Reserve’s clear message that the time had come to begin cutting interest rates. The Fed will remain data dependent, but 3 rate cuts seems likely by year end. Small caps enjoyed especially strong gains, benefiting from interest rate sensitivity.
With regard to small caps, the strategists suggest that the excitement around the asset class may be overdone given the mixed historical performance relative to large caps around the start of Fed rate cutting cycles.
Next, the strategists discuss what Fed policy means for the U.S. dollar and potential market implications of dollar weakness and highlight some encouraging messages from retailers during earnings season.
Last, the strategists preview the week’s busy economic calendar that includes the important core PCE deflator, the Fed’s preferred inflation measure.
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