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US stocks tend to gain around Fed’s Jackson Hole summer conference, analysis shows

  • Writer: The San Juan Daily Star
    The San Juan Daily Star
  • 5 hours ago
  • 3 min read

U.S. stocks have tended to fare well around the Federal Reserve’s Jackson Hole gathering in August, according to a historical analysis from DataTrek Research, although the market has seen sizable moves in both directions in recent years.


The Fed’s annual Wyoming research conference is set for Thursday through Saturday, and Chair Jerome Powell’s speech on Friday is expected to be the main event for markets.


DataTrek looked at the benchmark S&P 500 in the five trading days before and after the Fed chair’s speech since 2010. The index gained an average of 0.9% over the period, with the bulk after the speech.


“This suggests that markets get incremental clarity from the chair’s speech, which in turn boosts equity valuations,” Nicholas Colas, DataTrek’s co-founder, said in a research note.


This year, the S&P 500 has slipped in the lead-up to the speech so far, Colas said in the note published early Tuesday. “This goes against the usual pattern, so we would not be surprised to see the index rally modestly through Thursday,” he said.


One notable exception to the trend was in 2022, when the index slumped 7.4% in the 10-day period. That year at Jackson Hole, Powell warned of slower growth as the Fed fought high inflation. The S&P 500 fell over 19% for the full year 2022 as the Fed raised interest rates.


In 2023, the index gained 3.3% in the studied period.


DataTrek noted the S&P 500 fell in 2013 and 2015 when Fed chairs Ben Bernanke and Janet Yellen did not attend the symposium.


This year, investors are eager to see if Powell reinforces expectations of a central bank interest rate cut at its September 16-17 meeting. Recent weak labor market data bolstered those expectations.


Fed Fund futures on Tuesday were pricing in an 84% chance of such a move, according to LSEG data.


The S&P 500 benchmark U.S. stock index will end 2025 just below current near-record levels, reflecting tempered optimism amid ongoing concerns over the economic impact of President Donald Trump’s global tariffs and uncertainty surrounding Federal Reserve rate cuts, according to a new Reuters poll.


Market strategists polled by Reuters showed that concerns about potential stagnation related to tariffs have dampened optimism about Wall Street’s rally in AI heavyweights.


“I do not anticipate the United States entering a recession; however, I do expect the economy to experience a slowdown,” said Robert Pavlik, senior portfolio manager at Dakota Wealth. “Many employers lack visibility into future conditions and are therefore delaying expansion.”


The S&P 500 will end 2025 at 6,300 points, equivalent to a 2.3% dip from current levels, according to the median estimate of 35 strategists, analysts and portfolio managers polled August 7-19.


The S&P 500 ended Monday at 6,449.15 points, down 0.3% from its record high close on August 14.


Top of mind for U.S. investors, the Fed is widely expected to cut interest rates at its September policy meeting to support economic growth, possibly followed by another reduction by December.


Some 70% of global investors surveyed by BofA Global Research in early August said they expect stagflation - the combination of below trend growth and above trend inflation - in the next 12 months.


The S&P 500 has climbed 9% so far in 2025.


Strategists’ estimates have increased since a Reuters stock poll in May, when they expected the S&P 500 to end 2025 at 5,900. But this week’s poll forecast is still down from a Reuters poll in February, when they targeted the S&P 500 to end the year at 6,500.


While strategists struggle to predict the stock market, the latest Reuters poll offers a valuable glimpse of Wall Street’s cautious sentiment following recent record gains.


A series of deals with major U.S. trading partners, along with extensions of the White House’s self-imposed deadlines, has left investors less jittery about Trump’s on-again off-again global trade war than they were when his April tariff announcements sent global markets into a slump.


The S&P 500 and Nasdaq have climbed to record highs in 2025 in large part due to gains in Microsoft, Nvidia, Meta Platforms and other AI heavyweights. At the same time, S&P 500 sector indexes including healthcare, consumer discretionary, energy and real estate are nearly unchanged for the year.


“AI is a game changer for these companies, and they are being allowed to grow without any government interference,” said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder in New York. “It’s a revolution that’s going to continue for some time.”

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