S&P 500 outlook after Powell said inflation is still high

October 19, 2023 09:55 AM PDT | By Invezz

S&P 500 outlook after Powell said inflation is still high — Image source: Invezz

Powell sees a need for lower economic growth

Powell reiterated his commitment to eventually bringing inflation back to the 2.0% target – which he said would require a “a period of below-trend [economic] growth”.

#Powell blamed today's #inflation on the #pandemic. The pandemic didn't cause inflation, the #Fed and the Federal Government did. Both made the inflation problem worse during the pandemic by running huge budget deficits and printing a shitload of money to finance stimulus checks.

— Peter Schiff (@PeterSchiff) October 19, 2023

Speaking at the Economic Club of New York today, he called on the need for “further softening in labour market” as well to sustainably win the fight against inflation.

While his remarks were supportive of the “higher for longer” narrative, John Stoltzfus – the Chief Investment Strategist of Oppenheimer still said this morning on CNBC’s “Worldwide Exchange”:

Historically, once the market gets accustomed to higher rates, you find profitability can continue, and stocks can actually outperform bonds.

Stoltzfus says S&P 500 can gain 12% by year-end

Stoltzfus said the benchmark S&P 500 index could still end this year at about 4,900 level which represents a whopping 12% upside from here.

The Atlanta Fed is looking for good GDP growth. There’s a lot of reasons to believe this is still possible.

His forecast assumes one more rate hike this year. The Oppenheimer expert is convinced, though, that the Federal Reserve will switch to cutting rates before the end of 2024.

Watch here: https://www.youtube.com/embed/1FPieCDXo4M?feature=oembed

Note that inflation was up 3.7% year-on-year in September versus up 3.6% expected as Invezz reported here. Also on Thursday, the weekly jobless claims came in at 198,000 (seasonally adjusted) – well below the Dow Jones estimate for 210,000.

The post S&P 500 outlook after Powell said inflation is still high appeared first on Invezz

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