Markets Have Best Week Since 2020; Beaten Down Sectors Lead The Way Higher

Stocks had their best week of the year so far and staged impressive gains. The breadth of the rally this week was impressive. The S&P 500 and Nasdaq posted gains for four days in a row. The Nasdaq rose an impressive 8.1% this week. Friday in particular was marked by the conspicuous strength of several leading Technology stocks like Apple, Meta, and Nvidia having significant gains. The obvious question after such a strong rally is whether or not will mark a tradable bottom. So far, the 2/24 lows that occurred on the day of the Russian Invasion of Ukraine have held. The Federal Reserve took the much-anticipated action of raising the Federal Funds target by .25 bps, as was expected by most analysts. With inflation running hot by all measures, and with the added inflationary pressure from the war in Ukraine, the primary focus of the Fed has shifted to fighting inflation. The indications from the dot plot suggest that the Fed will raise by .25 six more times before the year is over.

One major question that remains is whether the Fed will need to raise the benchmark rate above neutral to assist in slowing growth. The committee so far believes that they will raise the benchmark rate to a peak of 2.8%, above their predicted neutral rate of 2.4%, sometime in 2023. However, hawkish...

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