This Hawkish Fed Was Good for Stocks: 3-Minutes MLIV

Summary

Mark Cudmore breaks down the post-Fed market implications and Iran oil developments. He sees further short-term downside for crude oil as Trump prioritizes a deal to lower prices before midterms. A surprisingly hawkish Fed from Kevin Warsh is viewed as ultimately positive for equities by restoring credibility and signaling a strong economy. Asian markets and the tech trade rallied on these narratives.

• Oil prices dropped after the Iran MoU was signed.
• Mark Cudmore sees more short-term downside for crude driven by Trump's political incentives.
• Kevin Warsh delivered a hawkish Fed message focused on inflation.
• Cudmore argues this hawkishness is good for stocks because it restores Fed credibility.
• Higher yields due to economic strength are less threatening to equities than stagflation.
• Asian equities and the tech trade received an additional boost from lower oil prices.
• European markets appear more hesitant in contrast.