Money Market Assets Under Management Following a Fed rate cut, money market funds typically experience outflows 12 months later as investors adapt portfolios and manage risk exposure in response to shifting interest rates and market conditions. Image: BofA Global Investment Strategy
S&P 500 Composite in Elections Years and Election Years When >10% Gains in Previous Year Given the Fed’s interest rate projections, market sentiment indicators and historical market behavior, investors may reasonably expect the S&P 500 index to reach new highs soon. Image: Fundstrat Global Advisors, LLC
S&P 500 vs. 1982 Analog With financial conditions easing considerably and the Fed set to cut rates in 2024, will the S&P 500 continue to track the 1982 analog? Image: Fundstrat Global Advisors, LLC
Annual U.S. Treasury Purchases by Sector This chart suggests that the Fed and money market mutual funds will buy the vast majority of new Treasury supply this year. Image: Financial Times
Conference Board U.S. LEI and 6-Month S&P 500 Forward Return A Fed rate cut is good for the S&P 500 when the Conference Board U.S. LEI is positive. Image: Fundstrat Global Advisors, LLC
Cyclical Stocks Responding to Steepening Long-term Yield Curve Keep in mind that the Fed has little influence on the long end of the yield curve. And currently, the 30-year Treasury rate minus 10-year Treasury rate spread has a normal upward slope, like in the mid-1990s when the economy was growing. The chart below shows that the…