The View from 5th Avenue

The View at Two – 17 September 2020

A cautious Fed means Red – Chairman Powell yesterday moved out his low rate scenario to the end of 2023 when they expect inflation to finally hit 2%.  But in the new let it run hot inflation targeting, does that mean rates could be lower for even longer than 2023?  Powell has always been the pragmatist in regards to Covid, listening to doctors, and acknowledging the economic impacts, but that does not mean the markets want to hear it.  Stocks, and bonds, are both under pressure again today in a broader risk off mood.  FANG is down 2.4% and this is keeping Nasdaq below its 50 day moving average (10982).  Value (-0.37%) is outperforming Growth (-1.4%), as well is the Russell (RTY -0.62%).  Tomorrow is quad witching expiration, and this will start to drive index/ single stock action into the weekend. 

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