FYI: Banks and smaller companies propelled stocks to their best January in 30 years, a sign that investors are favoring sectors tied to the U.S. economy.
Those groups were among the biggest laggards during the fourth quarter’s steep slide. Their reversal suggests that investors who were bracing for a sharp slowdown in U.S. economic activity have been soothed by cautious comments from the Federal Reserve, signs of strength in the labor market and data pointing to tepid inflation.
The Fed’s statement Wednesday that interest-rate increases are on hold helped ease investors’ worries that higher rates would increase borrowing costs and curtail corporate profits. Cautious comments from central-bank officials including Chairman Jerome Powell throughout the month also fueled the stock rally.
Regards,
Ted
https://www.wsj.com/articles/resilient-u-s-economy-fuels-january-stock-market-recovery-11548939600?mod=djem10point
