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Crypto, Stocks Climb Higher as Jackson Hole Inches Closer
Markets have recovered from their recent declines ahead of Jerome Powell's speech on Friday The market is spilling over what the outcome of September's Federal Open Market Committee might be The markets' recent decline provided some relief on Wednesday as both stock and crypto traders speculate about what central bankers might take away after this week's Jackson Hole symposium. Stocks managed to stay in the green during Wednesday's trading session, with the S&P 500 ticking up as much as 0.8% and the Nasdaq gaining 1%. After three days of rejection it was...
Crypto, Stocks Climb Higher as Jackson Hole Inches Closer
- Die Märkte haben sich von ihren jüngsten Einbrüchen vor der Rede von Jerome Powell am Freitag erholen können
- Der Markt wird darüber verschüttet, was das Ergebnis des Federal Open Market Committee im September sein könnte
Markets' recent decline provided some relief on Wednesday as both stock and crypto traders speculate about what central bankers might take away from this week's Jackson Hole symposium.
Stocks managed to stay in the green during Wednesday's trading session, with the S&P 500 ticking up as much as 0.8% and the Nasdaq gaining 1%. After three days of rejection, it was a welcome, if minor, reprieve.
Leading crypto assets Bitcoin and Ether also rose 1.2% and 0.8%, respectively, as of 2 p.m. ET, with Fed Chair Jerome Powell due in Jackson Hole in two days.
“We are at an inflection point for mega-cap trading as hedge funds brace for further weakness in bonds and a much weaker consumer as the economy slows,” said Edward Moya, senior market analyst at Oanda.
“Today’s rebound is small and low volume, meaning most traders are waiting until Fed Chair Powell’s symposium speech in Jackson Hole.”
The Economic policy symposium, hosted by the Kansas City Federal Reserve, begins Thursday. Powell is scheduled to speak on Friday and markets could be in for a surprise, analysts say.
“Fed funds futures and Treasuries say [Powell’s] Jackson Hole talk will be hawkish, with commitments to several more rate hikes and no apparent indication of a “pivot” in the first half of 2023,” said Nicholas Colas, co-founder of DataTrek Research.
“With a VIX of 24, U.S. stocks may not have fully embraced this eventuality.”
Futures markets show a 58.5% chance of a 75 basis point rate hike at the next policy meeting in September Data from the CME group. There is a 41.5% chance of a 50 basis point increase.
Even though markets are pretty evenly split between 50 and 75 basis points, economists don't expect rising rates to stop in September.
Dan Morehead, CEO and chief investment officer at Pantera Capital, expects fed funds rates to reach at least 4% or 5% before the central bank changes its strategy.
“You can’t tame runaway inflation with fed funds that are 600 basis points below inflation,” Morehead wrote in a note Wednesday. “The Fed will be forced to tighten much more than markets are currently forecasting.”
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The post Crypto, Stocks Edge Higher as Jackson Hole Inches Closer is not financial advice.