CITIC Securities: After Powell's dovish speech, the trading logic of "make-up" will dominate the next US stock market

CITIC Securities Research Report believes that Powell's speech at the Jackson Hole Annual Meeting is in line with our previous expectations. It is expected that the Federal Reserve will cut interest rates three times in a row within the year, each time 25bps. In terms of assets, we believe that the main line of the "interest rate cut transaction" in the US stock market will be re-clarified, and the trading logic of "make-up" will dominate the subsequent US stock market. Similar to the interest rate-sensitive Russell 2000, S & P 500 real estate and Nasdaq biotechnology in the "interest rate cut transaction" in July 2024, the rally may be repeated. The market's expectations for the Federal Reserve to cut interest rates within the year are still a certain distance from our view. We expect that the US bond interest rate and the US dollar index will still have a slight downward space. In non-US equity, Powell's dovish speech and a weaker dollar are expected to boost risk appetite in the global equity market. In gold, interest rate cuts are expected to boost gold prices, but be wary of the negative impact of a possible agreement between Russia and Ukraine.