The Stock Market Got a Rate-Cut Boost. Where It’s Headed Next.

The Federal Reserve finally cut interest rates, and while the decision to lower them by a quarter-point wasn’t a surprise, it hit the mark. No surprise half-point cut emerged to spark concern, and while some were hoping for more consensus about future cuts, Fed Chair Jerome Powell “expressed confidence in the current state of the U.S. economy and financial conditions,” notes DataTrek Research co-founder Nicholas Colas. To wit, Powell wouldn’t opine on whether a rate cut would further fuel a speculative stock bubble—maybe a good thing, given how Alan Greenspan’s “irrational exuberance” comments turned out—but the composition of the rally is reassuring.