Stocks Soar After Fed Quickens Taper Pace

Plus 5 New Strong Buys for Today Stocks Soar After Fed Quickens Taper Pace [Kevin Matras - EVP - Photo] Profit from the Pros By Kevin Matras Executive Vice President Stocks Soar After Fed Quickens Taper Pace [Stocks Soar After Fed Quickens Taper Pace]Image: Bigstock Stocks soared yesterday after the Fed announced their plans for dealing with inflation. The markets were underwater ahead of the FOMC Announcement and subsequent Fed Chair Press Conference. But then reversed course, and surged higher, making new intraday highs along the way, before finishing at their highs of the day. The Fed said they would double their taper pace in January from a -$15 billion bond-buying reduction each month, to a -$30 billion reduction (-$20B less in Treasuries and -$10B less in Mortgage-Backed Securities), accelerating their likely exit from quantitative easing in mid-March rather than the June end date that was previously expected. This wasn't necessarily a surprise per se, as the Fed had been hinting at this for several weeks. But the announcement finally made it official, and the market cheered the news. As for rates, it now looks like the Fed could raise rates at least once in 2022, and maybe as many as three times. But that too was cheered. Remember, inflation doesn't tank stocks, 'high' interest rates do. But even with three hikes, rates would still be near historic lows, i.e., less than 1%. And it should be noted that over the last 50 years, there's never been a recession (aside from last year's pandemic-induced plunge), when the Fed Funds rate was under 4%. So at quarter-point moves (even half-point moves), it would take years to get to that level. In fact, officials are suggesting rates could hit 0.9% in 2022, 1.6% in 2023, and 2.1% in 2024. A far cry from 4%. And that means a clear path for strong growth for the foreseeable future. With Q4 GDP expected to accelerate into the end of the year, and robust growth projected for next year and beyond, it looks like there's a lot more upside to go. To learn how to take advantage of the expected end of year rally, and get positioned for what could turn into a multiyear boom, be sure to read our latest commentary... [End Of Year Rally And Multiyear Boom]( Best, [Kevin Matras - Signature] Kevin Matras Executive Vice President, Zacks Investment Research Sponsor [Free Pick from Jeff Brown: "Buy S.C.G ."]( Jeff Brown picked Tesla in 2018 before it jumped 1,390% He picked Nvidia before it jumped 3,545% And he picked Bitcoin before it skyrocketed 22,750%. And now he's saying S.C.G. will be the next big tech play. He’s not the only one. Apple's CEO even called it "the next big thing." 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