Shares of banks and other financial institutions rose sharply amid hopes of a sustained turnaround in equity and bond markets.
There have been large inflows of investor capital into bonds and financial stocks, according to the latest survey by analysts at brokerage firm Bank of America Securities, a note to clients.
A big boost to stock gains is a change in the Federal Reserve’s rate hike outlook, one strategist said.
“Even though every Fed speaker has been out there saying, ‘No, it’s not over, we’re continuing to fight inflation,’ the market says, ‘We understand you’re not done, but you’re not going to be as aggressive .’ said Quincy Krosby, chief global strategist at brokerage LPL Financial.
Fed fund futures markets are now pricing in a 50 basis point hike at the September central bank meeting, rather than the 75 basis point previously expected.
Write to Rob Curran at [email protected]
Comments are closed.