NEW YORK (AP) — Wall Street rally evaporates after a sudden drop in price of oil deflates energy stocks; Dow and S&P 500 drop slightly.
6 Stocks That Will Benefit From a Dovish Federal Reserve
The quaint correction that was labeled the “tech wreck” of 2018 seems like a distant memory to investors. What also seems like a distant memory is any thought of the Federal Reserve raising interest rates.
At the end of 2018, the Federal Reserve had raised its benchmark federal funds rate. With the trade dispute with China dragging on, there was increasing pressure on the Fed to lower interest rates. When interest rates are lower, stocks will generally rise as investors have no other option for growth.
In July 2019, the doves got their wish. But in a move that now seems to be a “what did they know move”, the Fed dropped rates again in October. The market soared to record highs in January and early February. Since mid-February however, the market has fallen dramatically, and the Fed juiced the market one more time by cutting rates down to levels not seen since the financial crisis.
None of us know for sure when the U.S. economy will be opened up. And while stocks are still a good investment, not every stock is a smart investment at this time. But some stocks perform well when interest rates are falling and that’s why we’ve prepared this presentation.
These six stocks stand to benefit from both low-interest rates and the unique economic conditions being brought on by the Covid-19 pandemic.
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