More Bumps Ahead?

Fed Chair Jerome Powell has often said that the road toward lowering inflation down to the Fed's 2.0% target is likely to be bumpy. Nevertheless, there has been no turbulence in the stock market's smooth ascent to new record highs since October 27, 2023, which marked the end of a 10.3% correction in the bull market that started October 12, 2022 (chart).

Nevertheless, we should expect some turbulence for the stock market ahead similar to today's pullback. Leading the way down today was Tesla on lower-than-expected deliveries. Shares of health insurers fell after the Biden administration didn’t boost payments for private Medicare plans as much as the insurance industry and investors had hoped. After the close, Intel 's shares fell when the company reported a big loss in its foundry business.