The 2:00PM press conference held by US Fed Chairman Jerome Powell at the conclusion of the January 29, 2020, Federal Open Market Committee (FOMC) meeting started out with a bang. Within minutes, the S&P 500 rallied to its high of the day. Shortly thereafter, the world’s leading stock index began to make lower highs and lower lows to close near its lows for the day. From its intraday high to its close, the venerable index declined by 0.60%.
The S&P 500 declined steadily after the initial spike because Chairman Powell stated that US household spending had waned from “strong” to “moderate.” He also emphasized that inflation in the US was below the Federal Reserve’s target.
The volatility caused by the FOMC’s observation of a change in conditions for the US economy has increased the probability of a global market crash happening by the end of the first quarter of 2020. See also “Looking for Wuhan Virus To Cause Severe Market Correction or Crash,” from January 25, 2020.
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Equities Contributor: Michael Markowski
Source: Equities News