How will US market perform going ahead? Geoff Dennis answers

economictimes.indiatimes.com:

«Now in terms of what is going on here is that I think the market is a little puzzled by what the Fed said,» says Geoff Dennis, Emerging Markets Commentator.What we are seeing in the US markets is a stellar run. What is your assumption that what is actually fuelling this rally because we have seen Fed taking a rate hike but no stopping there. So going ahead what are the targets and what kind of a run up probably you are looking at?What is interesting is people do not focus so much on the Dow Jones Industrial Average anymore because of course it is a narrow index with just 30 stocks in it.

But still it is a noticeable record but the most important thing about this record is that you are now seeing a broadening out of the rally which was led dramatically earlier in the year by the NASDAQ and by the tech sectors. That is very-very good news even though the Dow Jones Index is quite unrepresentative of the overall market but it is still very good news. Now in terms of what is going on here is that I think the market is a little puzzled by what the Fed said.

They have left everything very-very open. They would have liked to clear a jump I think on what could happen in September but come what may we are at or close to the peak in interest rates. Second point is that the economy continues to look really good as far as we are concerned and as far as I am concerned with a better than expected GDP number.

So the chance of a soft landing here looked better and better almost by the day as inflation has fallen sharply and it looks like we are near the peak in interest rates. And I think this is what is driving above all the improvement in risk equities over the last several weeks not just frankly over the last few days. Not just the