Stocks bounce | Still the worst week since March | CDC warning
EDITOR'S NOTE
If investors are looking to Federal Reserve economists for guidance, they get a choice between a continued recession or the greatest boom since 1984, or maybe somewhere in between, as we roll into 2021.
CNBC's Jeff Cox writes that the Fed's forecasters are all over the map after the central bank's two-day meeting that concluded Wednesday - from gross domestic product to the unemployment rate and inflation.
"They've been pretty honest and straightforward about the high level of uncertainty that they see around how the economy's progressing, which is nice," said Kathy Jones, head of fixed income at Charles Schwab. It was a particularly bad week for stocks following the Fed's gloomy take on the economy. The Dow Jones Industrial Average ended the week down more than 5% and the S&P 500 fell more than 4%. And Friday's trading saw a spike in volatility as the Dow swung from a jump of more than 800 points to a modest loss and then moved back into the green to post a decent gain for the day.
A pullback should be expected, strategists say, following a staggering recovery from March. The market has been betting the economy will reopen smoothly, and then swiftly recover from the coronavirus pandemic, but a rise in cases in some states suggests things may not go quite that well.
"As more states get back, the question becomes: Are they going to ramp up fast enough to please Wall Street?" said JJ Kinahan, chief market strategist at TD Ameritrade. "What you're seeing is it'll be hard to do that."
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