Initially, the market seemed to like the announcement, most likely because they see Powell as being aggressive about bringing down inflation. Shortly after his announcement the DOW increased to .69% to 30,916. However, by the end of the day, the DOW dropped over 500. I feel investors are starting to realize how dire this economy is.
Powell also noted that housing will probably go through a correction and that the labor market will be softening. It’s tempting to start buying stocks but there are too many reasons to be on the sidelines right now. I’m still holding my breath that mid to end of October will be a good time to get back in the market though the light seems a bit dimmer.
