Keeping track: rate cuts

Fed reduction points to an upbeat market

An explosive rally in the stock market came as no surprise to analysts after the Federal Reserve cut interest rates last Wednesday.

Bruce Steinberg, chief economist for Merrill Lynch, noted in a January report that "the equity market nearly always had a double-digit rise within one year of the initiation of a Fed easing process." Despite weak corporate earnings so far this year, Mr. Steinberg saw "no reason why history won't repeat itself."

When the Fed made its first rate cut this year on Jan. 3, the Dow stood at 10646.15. A double-digit rise (at least 10 percent) by next Jan. 3 would push the Dow to at least 11710.

(c) Copyright 2001. The Christian Science Monitor

Share this story:

We want to hear, did we miss an angle we should have covered? Should we come back to this topic? Or just give us a rating for this story. We want to hear from you.

Loading...

Loading...

Loading...

Save for later

Save
Cancel

Saved ( of items)

This item has been saved to read later from any device.
Access saved items through your user name at the top of the page.

View Saved Items

OK

Failed to save

You reached the limit of 20 saved items.
Please visit following link to manage you saved items.

View Saved Items

OK

Failed to save

You have already saved this item.

View Saved Items

OK