Stocks Stage Big Rebound, S&P And Dow Finish Higher  Image: Bigstock Stocks closed mixed yesterday, but well off their lows. And the S&P and the Dow actually turned positive by day's end with the Dow closing within 0.37% of their all-time highs! The tech-heavy Nasdaq and small-cap Russell 2000 were hit the hardest early on. But they had been leading the rally over the last handful of months, so there was bound to be days like this. But they too bounced nicely off their intraday lows. The push for more stimulus continues with a mid-March goal.
Fed Chair Jerome Powell testified before Congress yesterday and eased concerns that the Fed would be tightening rates any time soon. With bond yields on the rise lately, there had been some concern that the Fed might decide to raise rates sooner than expected.
But he has been saying for nearly a year now that rates would likely stay near zero thru 2023. While he didn't put a date on it yesterday, he essentially said there's no talk of raising rates in the foreseeable future. And he has repeatedly said the Fed would allow inflation to run hotter and longer than usual before doing anything on rates.
He also said the Fed has no plans to taper their asset purchases either. Moreover, he reiterated that he would clearly communicate a change in policy before taking any action. It was exactly what the market needed to hear. And it appeared as if the market was listening. He buttoned up his remarks on a positive note by adding, "while we should not underestimate the challenges we currently face, developments point to an improved outlook for later this year." With virus cases falling, more and more people getting vaccinated, and more and more big cities coming off of lockdown and letting businesses open, a wave of big pent-up demand should ignite the economy. And with it, the market. See you tomorrow,  Kevin Matras
Executive Vice President, Zacks Investment Research | 
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