Bank of America said the stock market could enjoy a typical year-end sell-off after the Federal Reserve's decision on Wednesday. The central bank is widely expected to cut the benchmark interest rate by 0.5% on Wednesday. Bank of America equity analyst Gonzalo Assis said in a note to clients that the move could pave the way for a so-called “Santa Rally.” “The second half of December is typically the second strongest period of the year for U.S. stocks, with the S&P rising 83% of the time in December in presidential election years. is not expected to bring about [0.76% S & P 500] “This may be the last hurdle before the Santa Rally,” said the note. It may take a completely clear signal for the stock market to find its footing for a typical holiday rally. The Dow Jones Industrial Average fell for nine consecutive sessions for the first time since 1978. .DJI 5D Mountain Dow Jones Industrial Average of the past 5 sessions Of course, an increase will probably require not only a rate cut but also the absence of negative interest rates. Forecasts from Fed Chairman Jerome Powell's press conferences and central bankers' latest economic forecasts will include dot plots depicting the expected path of interest rates. Many on Wall Street expect the Fed to cut interest rates less than expected over the long term. Similar results were obtained during the previous dotplot release in September, but the labor market has performed better than expected since that meeting, and recent inflation has remained below the Fed's 2% target. It is shown that it is superior. “Market participants should keep an eye on economic forecasts to better understand the medium-term path of policy rates and whether the 2025 point indicates three or two rate cuts. There will be a rate cut in September. 4, but we expect it to land at 3. Dot is expected to see two rate cuts in 2026, with an upward revision from 2.9% to 3.125% in the long term.''・Of America Banknotes said.
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