Daily Market Color

Equities Fall as Powell Warns Economic Rebound May Be Slower than Expected

Risk assets fall as Powell shares grim economic outlook.  During his speech Wednesday morning, Fed Chair Jerome Powell raised concerns as he announced economic regrowth could happen slower than expected.  A slower growth rate and consistent joblessness may mean that economic recovery may not be in the much-anticipated “V” shape.  He added, “The scope and speed of this downturn are without modern precedent, significantly worse than any recession since World War II.”  He remained consistent with the sentiments of his colleges, announcing the Fed will not lower rates into negative territory, but believes that there may be a need to “do more,” passing the baton to Congress.  Major US indices dropped after his speech, with the Dow Jones and S&P 500 falling 2.2% and 1.7% respectively.  Treasury yields fell across the curve, with the 10-year trading 3 basis points lower this morning at 0.61%.

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