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BofA Warns the Fed Won’t Rush to Stock Market’s Rescue This Time

  • Confidence in buying the dip may be waning, strategists say
  • BofA’s outlook contrasts with Goldman’s bullish call on stocks

The U.S. Federal Reserve may not be so eager to rescue the stock market this time around, according to Bank of America Corp. strategists. 

“The Fed may be less willing to so easily deviate from tapering plans and talk the market back up as during the last cycle,” BofA strategists including Riddhi Prasad and Benjamin Bowler said in a note. As reasons for their skepticism they cite equity valuations and returns accelerating to “extremes,” and “increasingly real” risks of inflation overshooting.