A Powell put for the stock market? Dont even think about it
Think new Federal Reserve Chairman Jerome Powell will exhort his monetary-policy making colleagues to run to the stock market’s rescue if things get hairy? Think again.
Economists are skeptical that a Fed that was already firmly moving toward normalizing monetary policy in the latter years of Janet Yellen’s term at the helm would be easily compelled to change course in the face of a continued market downturn.
For a Fed “that has lamented elevated valuations in the equity market, the selloff in stocks is not especially concerning,” wrote Neil Dutta, head of economics at Renaissance Macro, in a Monday note with the title: “Don’t even think about a Powell put.”
Archives: Here’s why investors look too complacent about the Powell Fed
Stocks ended sharply lower on Friday, capping the biggest weekly decline for the S&P 500 SPX, -2.36% and Dow industrials DJIA, -2.92% in two years. Stocks extended the decline Monday. The pullback, widely described as overdue, comes after a long-running stock market rally saw a “parabolic” acceleration in January that took major indexes to a series of all-time highs.
https://www.marketwatch.com/story/a-powell-put-for-the-stock-market-dont-even-think-about-it-2018-02-05?siteid=rss&rss=1
