Why the new bull market is headed for more Fed stress after a rate hike pause

Traders are signaling that a pause in interest rate hikes is the most likely outcome of this week’s Federal Open Market Committee meeting of the Federal Reserve, and that comes at a time when some strategists are saying a new bull market is underway. The Dow Jones Industrial Average posted three winning sessions in a row to end last week, the NASDAQ Composite saw its sixth-consecutive positive week for the first time since November 2019, and all major indices closed above their 50-day and 200-day moving averages on Friday.

“The bear market is officially over,” Bank of America equity strategist Savita Subramanian recently said, noting that the S&P 500 has risen 20% above its October 2022 low.