JPMorgan Sees S&P 500 Swinging 2% on Fed Decision as 25-Basis-Point Hike Is Priced In
Updated
Updated · Yahoo Finance · Sep 16
JPMorgan Sees S&P 500 Swinging 2% on Fed Decision as 25-Basis-Point Hike Is Priced In
3 articles · Updated · Yahoo Finance · Sep 16
Summary
JPMorgan said the S&P 500 could move from a 1% gain to a 2% drop after Wednesday’s Fed decision, with Chair Kevin Warsh’s message seen as more important than the rate move itself.
An expected 25-basis-point hike could lift stocks 0.25% to 0.75%, or 0.5% to 1% if Warsh frames it as unwinding 75 basis points of 2025 easing rather than starting a broader tightening cycle.
A surprise hold could knock the index down 1.25% to 1.75% because investors may question the Fed’s inflation-fighting resolve and push longer-term Treasury yields higher from around 5% on the 10-year note.
The most bearish outcome is a hike paired with signals that rates must stay higher for longer or rise materially further, which JPMorgan estimates would send the S&P 500 down 0.25% to 2%.
Polymarket traders priced an 89% chance of a quarter-point hike and 11% odds of no change, with about $193 million traded before the Fed’s 2 p.m. ET decision and 2:30 p.m. press conference.