S&P 500 Leaves 6,000 Behind, As FED’s Powell Remains Upbeat, Keeping Stocks Bullish

Earlier, FED’s Jerome Powell sounded optimistic about the US economy, which means fewer rate cuts, helping the S&P 500 approach 6.100 points.

S&P 500 broke above the 6,000 points level at the end of November, and after a short-lived dip, it returned above and has not looked back since then. The uptrend has been very consistent as the Trump trade continues to play out, suggesting that the SPX index will likely reach 6,100 points tomorrow.

The economic data from the US was negative yesterday, with the ADP employment diving to 146K in November and October’s numbers revised around 50K lower. However, FED chair Jerome Powell made some optimistic comments on the US economy yesterday.

S&P 500 Daily Chart – The Upside Momentum Continues

Jerome Powell stated that the economy is performing more strongly than anticipated in September, with robust growth and a labor market showing fewer downside risks. While inflation has risen slightly, Powell emphasized that the Federal Reserve can afford to approach its goal of achieving neutral interest rates with greater caution.

FED Chairman Jerome Powell Remarks

• Positive Outlook on Monetary Policy: Confidence expressed in the current state of U.S. monetary policy.
• Strong Economic Fundamentals: The U.S. economy is described as being in excellent condition with optimism for continued strength.
• Institutional Stability: Assurance that the relationship between the Federal Reserve and the Treasury will remain consistent under the new administration.
• Fed Independence: Highlighted as self-funded, maintaining operational independence.
• Cautious Approach to Neutral Rates: The Federal Reserve is taking a measured path toward achieving neutral interest rates, acknowledging that downside risks are lower than previously anticipated.
• Stronger Growth and Persistent Inflation: Economic growth has surpassed September projections, while inflation has been slightly higher than expected.

The Federal Reserve remains cautiously optimistic, balancing stronger-than-expected growth and manageable inflation with a careful progression toward neutral rates, which keeps in place the 2 rate cut projections for 2025, that’s mot much at all, so the USD has an extra bonus. This measured approach aims to sustain economic momentum while maintaining stability.

S&P 500 Live Chart

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