Markets extended on early morning US gains on Thursday after dovish comments from Fed Chair Powell during the IMF spring meeting, who is now considered the indisputable market soothsayer said:
“The recovery here remains uneven and incomplete.”
Powell told a virtual panel, adding that the world won’t be able to resume economic activity until the covid-19 is controlled everywhere fully. Fed officials have repeatedly stressed that the US economy needs aggressive monetary policy support as it recovers from the pandemic, even as the outlook brightens with vaccinations increasing.
With the FOMC continuing to turn the dovish policy aircraft carriers into the winds of growth, it's providing the ultimate lift-off channel for risk. Momentum/Growth outperformed as Smidcap Tech was back in the green as high growth baskets surge. But Value, Reflation and the Reopening trade generally underperformed.
Elsewhere, Treasuries pushed higher, led by 7-10y, and the dollar resumed its April swoon, providing a fillip to the commodity channels.