Federal Reserve Expected to Cut Rates by 75 Basis Points in 2026, Bullish Outlook for Stocks
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 3d ago
0mins
Source: Fool
- Rate Cut Expectations: The Federal Reserve anticipates a 75 basis point cut to the benchmark rate in 2026, with the market betting on this move to stimulate economic growth and drive stock prices higher, despite inflation risks.
- Strong Economic Growth: The U.S. GDP growth rate reached 4.3% in Q3, exceeding expectations, and is projected to maintain a 2.5% growth rate for 2026, providing robust support for the stock market.
- Analyst Optimism: Goldman Sachs analysts predict the S&P 500 will rise 12% by the end of 2025, reaching approximately 7,670 points, primarily driven by strong performance in the technology sector, reflecting confidence in the market's future.
- Risk Warnings: Despite the bullish sentiment, Goldman cautions that weaker-than-expected economic growth or the Fed's failure to cut rates as anticipated could pose significant risks to stock market gains, necessitating investor vigilance.
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Analyst Views on CME
Wall Street analysts forecast CME stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for CME is 285.90 USD with a low forecast of 209.00 USD and a high forecast of 320.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
10 Analyst Rating
4 Buy
4 Hold
2 Sell
Hold
Current: 284.480
Low
209.00
Averages
285.90
High
320.00
Current: 284.480
Low
209.00
Averages
285.90
High
320.00
About CME
CME Group Inc. provides a derivatives marketplace. The Company enables clients to trade futures, options, cash and over the counter (OTC) markets, optimize portfolios, and analyze data. It exchanges offer a range of global benchmark products across all major asset classes based on interest rates, equity indexes, foreign exchange (FX), energy, agricultural products and metals. It offers futures and options on futures trading through the CME Globex platform, fixed income trading via BrokerTec and FX trading on the EBS platform. In addition, it operates central counterparty clearing provider, CME Clearing. Its products provide a means for hedging, speculation and asset allocation related to the risks associated with, among other things, interest rate sensitive instruments, and changes in the prices of agricultural, energy and metal commodities. It provides clearing and settlement services for a range of exchange-traded futures and options on futures contracts and OTC derivatives.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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