Trump and FED can trigger "unseen" by far stock rally

07.03.2019 / 17:26

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Trump and FED together can trigger a "shock" in the shares, which can send the S & P500 over 3000. At least this is the view of J.P Morgan.

This will amount to a jump of 7% of current levels. The effect of "shocking awe" can shape scenarios that include canceling all tariffs between China and the US instantly, which will force many export-dependent companies on both sides to revise their projections for 2019 towards a more positive outlook. At the same time, if the FED remains faithful to holding reserves of about $ 1.3 trillion, SPX will easily reach, even surpass 3,000.

The bank notes that Powell intends to announce this week that the Fed can stop the normalization of the balance sheet to a $ 1 trillion reserve. Investors wonder if the S & P500 will remain at a "pause" of less than 2800, or they will make another impulse to 2850.

More likely expectations are for consolidation between the price range of 2750 and 2800, while the Fed sheds more light on its intentions, especially for the balance.

Source: CNBC

Trader Martin Nikolov

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Trump and FED can trigger "unseen" by far stock rally

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