Hot Stock Rally Stirs Fears Over Wall Street’s Big Rate-Cut Bets
- Wealth effect from equity boom seen risking inflation comeback
- History shows bear-market recovery tends to herald more upside
The S&P 500 set fresh records in five straight sessions before Friday, extending an upward march that has added $8 trillion to shareholder value.
Photographer: Michael Nagle/BloombergThis article is for subscribers only.
Is the equity rally getting too hot for the Federal Reserve? It’s an increasingly pressing question for Jerome Powell, after three months of gains put pressure on his efforts to keep screws on the economy tight.
Fueled by uncertain bets that the central bank will embark on a protracted series of interest-rate cuts this year, the S&P 500 set fresh records in five straight sessions before Friday, extending an upward march that has added $8 trillion to shareholder value. Gains pushed a measure of financial conditions to the loosest since early 2022.