Fed's Rate Decisions Shake Up Markets

The S&P 500 has dropped 7.9% since the Federal Reserve began raising interest rates a year ago, with the index down over 16.5% from its record high in December 2021. The Fed has raised rates eight times in the past year, with a ninth increase announced on Wednesday, citing the need to curb inflation. While interest rate hikes don't always correlate with losses in stock market indexes, analysts often look to the Fed's actions and projections when setting their own outlooks for market performance. J.P. Morgan predicts that the S&P 500 will re-test the lows of 2022 in the first half of 2023, but could recover later in the year if the Fed pivots.