The S&P 500, the Nasdaq 100 and the Dow suffered heavy losses during the week after the Federal Reserve endorsed a hawkish monetary policy tightening path. The widespread narrative is that the Fed’s aggressive normalization cycle, coupled with its pledge to keep a restrictive stance for an extended period of time, will trigger a painful hard landing. While brief bear market rebounds cannot be ruled out, a sustained recovery seems difficult, with traders and speculators likely tempted to fade any rally attempt for now. The bearish sentiment will not fade any time soon; in fact, the mood could get worse before it gets better in the near term, exacerbated by the negative seasonal factors that tend to undermine equities in late September and October, says DailyFX. . . .
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