Investors Shrug Off Recession Worries

Newly released GDP figures suggesting the economy is on the brink of a recession didn't result in a bleak day on Wall Street. In fact, markets had a decent day, with the Dow up 332 points to 32,529, the S&P 500 up 48 points to 4,072, and the Nasdaq up 130 points to 12,162. All the gains were a bit above 1%. CNBC frames the thinking this way: The GDP shows that the economy continues to slow down, which means the Federal Reserve might have to lighten up on its aggressive rate hikes in future meetings.

However, nobody seems to be quite sure what to bet on in regard to the Fed. "There can often be this ‘bad news is good news’ idea,” Hani Redha of PineBridge Investments tells the Wall Street Journal. “But for the Fed, fighting inflation is still the priority.” The Journal notes that all three major indexes are up about 7% from their yearly lows in June. (Is the US in a recession? An obscure eight-member panel of economists will have the final word.)