The stock market has been on a roll lately, with the S&P 500 soaring 13% since June 16 amid optimism that the Federal Reserve won’t raise interest rates much more.
But now Fed officials are making clear that their rate hikes could continue for a long time. And keep in mind that the S&P 500 remains down 13% year to date.
So the $64,000 question is whether the stock market will continue its recent rebound. That could happen in the short term, Goldman Sachs strategists wrote in a commentary.
“In recent weeks, there has been a partial turn in [investors’] positioning and sentiment from very bearish levels after a rough first half of the year, with … positioning rebounding from historical lows,” they said.