Stock Market Outlook: What To Watch For In The Next 6 Months

It may be very difficult for the FOMC to justify a rate cut until the jobs market cools down. The longer the Fed is forced to maintain interest rates at current levels to get inflation under control, the higher the likelihood of economic fallout at some point down the line. This risk is reflected in the New York Fed’s U.S. recession probability index, which still projects a 61.5% chance of a recession within the next 12 months. In other words, interest rates at the current level are not the end of the world. Indeed, compared to fears last year of deteriorating economic conditions that would translate into surging unemployment and crashing corporate earnings, the story has been the stronger than expected trends overall.

Intense competition in the wholesale power markets, foreign currency fluctuation, cyber-based security risk and disruptions in the fuel delivery system might impede the company’s growth. Increasing consumer traffic, higher quote request volume and lower advertising costs are key positives. Strategic sourcing initiatives, increased penetration of private label products, digital engagements and improving traffic should contribute to its overall performance. Shares of New York Community Bancorp soared back into the green on news it was getting a $1 billion infusion from the investment firm run by former Treasury Secretary Steven Mnuchin and other funds. Stocks gained Wednesday after Federal Reserve chairman Jerome Powell told Congress he won’t rush to raise rates. Some ETF issuers take the guesswork out of sector rotation for you by doing it themselves within a sector rotation ETF.

Over the period, we’ll get through several months of key economic indicators including payrolls, retail sales, and industrial activity and we want to see conditions remain strong as good news moves us away from a recession. Similarly, getting into Q1 and Q2 earnings seasons, it will be important for companies to demonstrate the ability to maintain margins and drive profitability. At the center of everything we do is a strong commitment to independent research and sharing its profitable discoveries with investors. This dedication to giving investors a trading advantage led to the creation of our proven Zacks Rank stock-rating system. Since 1988 it has more than doubled the S&P 500 with an average gain of +24.18% per year.

1. To summarize, federal funds futures markets are almost certain an interest rate cut is coming soon.
2. Strategic sourcing initiatives, increased penetration of private label products, digital engagements and improving traffic should contribute to its overall performance.
3. Resumption of the payment of quarterly dividend highlights its shareholder-friendly stance.
4. FedWatch data suggests that there will probably be no cut at the May meeting, either — but the odds aren’t quite as slim as for March, at the time of writing.

You’ll receive continuously updated Zacks Rank and Style Scores, Earnings Estimate Revisions, Broker Recommendation Changes, Earnings Surprises and more. Note that you should also add your mutual fund and ETF positions to monitor changes in their Zacks Rank as well. Hormel Foods intends to strengthen its business on the back of strategic acquisitions.

The SPDR SSGA US Sector Rotation ETF (XLSR) and the Main Sector Rotation ETF (SECT) are examples. This may influence which products we review and write about (and where those products appear on the site), but it in no way affects our recommendations or advice, which are grounded in thousands of hours of research. Our partners cannot pay us to guarantee favorable reviews of their products or services. We believe everyone should be able to make financial decisions with confidence. While FOMC officials are no longer forecasting a recession, the latest Federal Reserve economic projections in December suggest a sharp drop in U.S.

Stock Market Outlook: What To Watch For In The Next 6 Months

While we don’t have a crystal ball, we do believe that a «pause» by the Fed can and will occur in the next six months, with the implied easing of policy conditions working as a tailwind for stock market sentiment. We expect two more 25 basis point hikes in the Fed funds rate between the March and May meeting to hold the rates steady from there. A bullish scenario https://www.day-trading.info/ would be continuation of the ongoing decline of the CPI, leading the Fed to hold the Fed funds rate steady and marking a key turning point in the cycle. One possibility is that core-consumer prices reflecting goods and services beyond food and energy can surprise lower through components like shelter and transportation prices stabilizing going forward.

All three benchmark indexes edged up, while bond yields were about flat. The shares included in it are weighted according to price; the index level represents the average of the shares included in it. US business leaders are gaining confidence in the US economy, and a new sentiment reading clocked in above trend for the first time since 2021. On the downside, it will be important for the market to hold $4,000 as an area of psychological support in a big round number, while a break under $3,800 would be more concerning and undermine the current momentum. Data shows that at the end of December, institutional money managers were the most underweight U.S. equities since 2005. If we fast forward, the latest update through the first week of February shows an ongoing shift toward increasing allocations into stocks by that same group turning more bullish.

Stock market today: US stocks rise as markets digest Powell comments

These returns cover a period from January 1, 1988 through January 1, 2024. Zacks Rank stock-rating system returns are computed monthly based on the beginning of the month and end of the month Zacks Rank stock prices plus any dividends received during that particular month. A simple, equally-weighted average return of all Zacks Rank stocks is calculated to https://www.topforexnews.org/ determine the monthly return. Only Zacks Rank stocks included in Zacks hypothetical portfolios at the beginning of each month are included in the return calculations. Certain Zacks Rank stocks for which no month-end price was available, pricing information was not collected, or for certain other reasons have been excluded from these return calculations.

Zacks may license the Zacks Mutual Fund rating provided herein to third parties, including but not limited to the issuer. We’ve filtered the list for companies with a market capitalization of at least $100 billion — high-volume stocks whose earnings reports are often major trading events for options traders and day traders. The technology sector has reported 20.8% earnings growth in the fourth quarter as the rally in artificial intelligence stocks has continued in early 2024.

Dow Jones 30 Industrial

For investors that have been sitting on the sidelines, gradual allocations into stocks with regular contributions to savings and retirement accounts is a good starting point. What it would take for us to turn convincingly more bearish would be some evidence that corporate earnings, particularly from the major S&P 500 leaders, are falling. This could evolve as a consequence of some financial market imbalance, or reach some type of breaking point where https://www.forexbox.info/ higher interest rates materially impact the company’s financials and operating environment. The other side to that discussion is the potential negative consequences to the economy of the higher interest rate environment we’re now in. In many ways, this has been one of the biggest surprises over the past year, being that economic conditions including consumer spending and corporate earnings have been able to, thus far, manage the impacts well.

U.S. Natural Gas Futures Slip Ahead of Storage Report

The understanding is that the quantitative tightening impact intended to bring down inflation is still working through the monetary system and the real economy. Our interpretation is that significantly higher rates from here may not be necessary for the inflation rate to continue trending lower. Intel’s leading position in PC market, strength in servers, growing clout in software, IoT & ADAS domains and headway in process technology are positive indicators of future growth prospects. Consistent top-line growth, accretive acquisitions and solid acute care platform are key positives. You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security.

The just-released January update shows the annual headline figure printing at 6.4%, taking important steps in the right direction. By this measure, it’s fair to maintain an expectation that stocks will continue to climb which is supported by a combination of both economic fundamentals and market technicals. CrowdStrike is benefiting from the soaring demand for cyber-security solutions owing to rising data breaches. Also, its sustained focus on rolling out new products, acquisitions and partnerships will continue to boost sales. MasTec will benefit from strong backlog and growth prospects of the segments, along with the recent acquisitions. You can also find a report on the ticker of your choice, or access all of the stock reports covered by Zacks analysts.

Green Dot is not planning to declare dividends deterring investors seeking cash dividends while its revenues are troubled by seasonality. Natural gas futures settle lower in cautious trade ahead of the EIA’s storage report. Neither the author nor editor owned positions in the aforementioned investments at the time of publication.

We’d argue that given the growing importance of the technology sector, even higher market multiples can be justified particularly in an environment where inflation is trending lower and interest rates stabilizing. With any bullish case, it’s also worth considering what could go wrong and lead to a deeper selloff. Sharply higher gasoline prices, for example, would force companies to keep passing along the higher costs to consumers as directly impacting inflationary pressures.