‘Sell Your Hedge and Move On’: Anxious Stocks Surge After Powell
- Traders anticipated hawkish turn, expected even worse
- Fed set to end bond buys in March, potentially hike rates
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Stock traders prepared for the worst -- and didn’t get it.
That may be the best explanation for how a seemingly hawkish turn by Jerome Powell translated into the biggest rally since 2020 on the day of a Federal Reserve decision. Traders laid in hedges, braced for Armageddon, and then turned tail when Powell balanced his rates outlook with a strong dose of economic optimism.