Skyrocketing Fuel Costs Threaten 15% Drop In S&P 500, Pimco's Erin Browne Warns
Portfolio Pulse from Piero Cingari
Erin Browne, portfolio manager for multi-asset strategies at PIMCO, warns that the surge in fuel prices could potentially trigger a recession and drive the S&P 500 Index down by approximately 15%. Browne suggests that the rise in oil prices could lead to increased prices for durable goods, negatively impacting the economy and making it difficult for the Federal Reserve to meet market expectations of three rate cuts next year. She also anticipates potential signals of stronger demand for goods in 2024, particularly in consumer-oriented sectors and semiconductor companies.
September 20, 2023 | 3:14 pm
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The SPDR S&P 500 ETF Trust (SPY) could potentially face a 15% drop due to the surge in fuel prices, as warned by Erin Browne of PIMCO. This is due to the potential impact of rising oil prices on the economy and the Federal Reserve's rate cut plans.
The surge in fuel prices, as highlighted by Erin Browne, could potentially trigger a recession and negatively impact the economy. This could in turn affect the Federal Reserve's ability to meet market expectations of three rate cuts next year, which could lead to a drop in the S&P 500 Index and consequently, the SPDR S&P 500 ETF Trust (SPY).
CONFIDENCE 75
IMPORTANCE 80
RELEVANCE 100