Investors eye Fed rate cut, earnings as key to sustaining market rally

==========

Investors are watching for a potential interest rate cut by the Federal Reserve and the health of upcoming earnings to sustain the market rally. The S&P 500 had a gain of over 10% in the first quarter, with economically-sensitive sectors such as energy and industrials rallying. The market's continuation through June will depend on the Fed's actions and economic reports. Futures markets imply a 61% chance of a rate cut in June. Continued growth in the US economy may lead to a broadening of the market rally into cyclical sectors and small-cap stocks. Economic readings next week, including ISM manufacturing data and non-farm payrolls report, will provide further insight. The market rally may slow as the Fed nears a potential rate cut, but historically, strong momentum in the first quarter has carried over to the second quarter. Corporate earnings will also play a significant role, with expectations of a 5.1% earnings growth in the first quarter. If earnings continue to surprise to the upside, the Fed may have a hard time justifying rate cuts. However, a leveling out of inflation could lead to a more sustainable economic re-acceleration.

#Investors #FederalReserve #InterestRateCut #Earnings #MarketRally

https://finance.yahoo.com/news/investors-eye-fed-rate-cut-100955745.html