As earnings season approaches and uncertainty remains over whether the Federal Reserve will cut interest rates, JPMorgan Managing Director and Global Market Strategist David Lebovitz appeared on Yahoo Finance Live to predict a rate cut. Discuss whether FedSpeak or revenue may play a larger role as an influencing factor.
Lebovitz believes both earnings and FedSpeak will help shape rate cut expectations. However, he stresses that everything still relies on data. He said FedSpeak could “take a backseat” to earnings on upcoming inflation reports, including Friday's jobs report, if the data is released as expected.
He noted that profit growth “depends on developments in the macro environment.” If the Goldilocks scenario materializes, the S&P 500 (^GSPC) could easily reach new highs, but if the disinflationary trend continues, the upside could become “more difficult.”
Continued volatility in the bond market is evidence of “persistent uncertainty about what's going on with inflation,” Lebowitz suggests. However, he added that if the data and FedSpeak support a Fed rate cut, “bond volatility could decline.”
For more expert insights and the latest market trends, click here to watch the full episode of Yahoo Finance Live.
Editor's note: This article was written by angel smith
