U.S. Federal Reserve and stock market

The annual Jackson Hole Economic Policy Symposium starts on Thursday. This annual symposium will help to better understand the policies of the Federal Reserve. On Wednesday, the Federal Open Market Committee (FOMC) will release the information about its meeting, which took place in July. Federal Reserve Chairperson Jerome Powell will open the symposium on Thursday.

U.S. stock market on Monday

At the moment, the U.S. stock market is in a tough position. For example, the S&P 500 index, as well as NASDAQ and Dow Jones Industrial Average, indexes reduced by 5%. It is essential to mention that significant indexes mentioned above experienced the third week of negative results in a row.

One of the significant reasons which caused these problems for the stock market is the fact that 10-year Treasury yield fell below 2% rate. This happened for the first time in 12 years. This fact might serve as an indicator for a possible crisis.

This symposium is critical as Federal Reserve should play a more important role to stabilize the situation. Moreover, some analysts believe that the Federal Reserve should address issues such as bond yield inversion, recent market swings, etc.

On Friday, Powell will address the attendees of the symposium. Analysts will try to learn more about future plans. However, as a Jackson Hole is an academic conference, the chances that Powell will reveal many interesting details are quite low. Federal Reserve decreased the interest rate for the firm in more than a decade. This happened several months ago.

However, some analysts thought that the Federal Reserve would also cut the interest rate in July. However, this did not happen, but the situation might change as the next meeting will take place in September.

Marker researcher James Bianco thinks that should act to protect the stock market. Bianco said that Jerome Powell, in his speech, should mention the problems connected to the stock market.

U.S. stock market experienced problems several days ago. The U.S. Federal Reserve has the capacity to help the stock market. One of the solutions is to reduce the interest rate at the meeting in September.