Last week, the stock market saw a significant rally following comments from President Donald Trump and the Federal Reserve. The Dow Jones Industrial Average jumped more than 600 points, with the S&P 500 and Nasdaq also posting gains. But what will drive the stock market in the coming weeks after this rally?
There are two key factors that are likely to influence the stock market in the near future: trade tensions and interest rates.
Trade tensions between the United States and China have been a major driver of market volatility in recent months. The ongoing trade war has led to uncertainty among investors and businesses, impacting global economic growth. Last week, President Trump announced that the U.S. and China had reached a “phase one” trade deal, which helped to boost market sentiment. However, details of the agreement are still unclear, and there are concerns that the deal may not address all of the key issues in the trade dispute. Any developments in the trade negotiations between the two countries are likely to have a significant impact on the stock market.
Another key factor that will drive the stock market is interest rates. The Federal Reserve cut interest rates three times this year in an effort to stimulate economic growth and inflation. Last week, the Fed signaled that it would likely keep interest rates on hold for the foreseeable future. However, the central bank also indicated that it would continue to monitor economic data and make adjustments to monetary policy as needed. Any changes in interest rates or the Fed’s monetary policy stance could impact investor sentiment and market performance.
Overall, while last week’s rally was a positive sign for the stock market, there are still uncertainties that could impact market performance in the coming weeks. Investors will be closely watching developments in trade negotiations and any changes in interest rates to gauge the direction of the market. As always, it’s important for investors to stay informed and be prepared for potential market volatility.