Why did equities go up after the Fed announcement yesterday?
$SPDR S&P 500 ETF (SPY.US)$ $Invesco QQQ Trust (QQQ.US)$ Yesterday the Fed announced 3 interest rate hikes to tackle inflation in 2022. This hawkish move pushed the stock market up after nearly a week of constant decline.
Why didn't this push the stock market down further? My understanding is that if there are planned interest rate hikes, this tends to decrease equity valuations so the market goes down. Can someone explain why it went up?
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Dabria : The market and you expected higher interest rates faster.
What you saw was a correction, a fast move down and a correction bringing on average stocks back to where they were.