Wednesday, 10 February 2021

Markets mixed, Fed to remain accommodative “for a very long time”

Markets were mixed on Tuesday.

The S&P 500 fell 0.1 percent, ending a six-day winning streak. The STOXX Europe 600 also fell 0.1 percent.

Earlier in Asia, though, the Shanghai Composite jumped 2.0 percent and the Nikkei 225 rose 0.4 percent.

“We expect a buyable 5-10% Q1 correction as the big ‘unknowns’ coincide with exuberant positioning, record equity supply, and ‘as good as it gets’ earnings revisions,” said Jared Woodard, investment and ETF strategist at Bank of America.

A correction could well be “buyable” if the Federal Reserve remains determined to keep monetary policy easy.

“We’re going to be accommodative for a very long time because the economy just needs it to get back on its feet,” said Cleveland Fed President Loretta Mester on Monday.

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