The stock market loved “Happy Jay Powell” yesterday, with equities rallying strongly off their pre-Federal Open Market Committee lows. The Nasdaq was the big winner, gaining XX%, and tech names are looking strong again this morning.
Don’t forget about gold and silver, either. Both continue to rip higher, with silver recently up by almost 4%. Treasuries are rallying, too, while the dollar is flat.
Meanwhile on the news front ...
The Federal Reserve hiked interest rates by 25 bps as expected. That puts the federal funds rate in a range of 4.5%-4.75%. But because Chairman Powell indicated the Fed was seeing progress on inflation, markets now expect only one or two more 25 bp hikes in this cycle.
Unit labor costs rose only 1.1% in Q4 2022, while productivity rose sharply. Both readings helped ease concern about wage-driven inflation. Meanwhile, layoff announcements soared 440% YOY in January to 102,943. Tech companies (no surprise) accounted for 41% of that.
While tech is going through a rough patch, Gene Munster told me in our recent MoneyShow Expert Interview Series talk that he’s optimistic about how things will shake out later in 2023. You can watch the video interview here: https://youtu.be/PRlEvFQsqCs
