A snippet from Nomura on the US stockmarket leading into the Federal Reserve's Federal Open Market Committee meeting later this month.
- recent rhetoric by Fed Chair Powell suggests the "Fed put" is soon to be exercised
- US macro surprise index has picked up
We even think there is an automatic stabilizer of sorts in place:
- even if US stocks were to fall off steeply between now and the July FOMC meeting, we would then expect the market to increasingly expect a rate cut of at least 50bp
- and those expectations would presumably pull the stock market back up
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Yep.