From Hikes to Cuts

March 27, 2023

The Nasdaq just went out last week at new 7-month highs.

Growth stocks are back.

But why?

And when you look at the intermarket relationships, it makes a lot of sense:

The Copper/Gold and Banks/REITs ratios are the commodities market's and stock market's views on rates, respectively.

Neither of them are pointing to higher rates.

Meanwhile, Fed Fund Futures went from pricing in more rate hikes this year to now pricing in rate cuts.

So let's think about which types of stocks do well in an environment where interest rates are NOT rising.

It's no wonder that Growth is doing so well this year.

These are a couple of ratios to keep a close eye on as a heads up of whether there is more to come.

My suspicion is there is...

What about you?

What are you thinking here?

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