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Tec Savvy Nasdaq turns green after Fed’s Powell meets with lawmakers on his confirmation

Fed’s chair Powell appeared before the U.S. Senate Committee on Banking, Housing and Urban Affairs as part of his second term nomination hearing. Although he sounded hawkish, S&P 500 reversed the five-day slide, the tec-heavy Nasdaq soared 200 points and Dow is up about 200 points.

Powell remarked that, “as we move through this year … if things develop as expected, we’ll be normalizing policy, meaning we’re going to end our asset purchases in March, meaning we’ll be raising rates over the course of the year.” He also told the committee members that “at some point perhaps later this year we will start to allow the balance sheet to run off, and that’s just the road to normalizing policy.”

Senators from both sides of the aisle questioned him on inflation, which is running at a close to 40-year high as well as ethical lapses from central bank officials. Powell told the committee, “If we see inflation persisting at high levels longer than expected, then if we have to raise interest more over time, we will,” Powell said. “We will use our tools to get inflation back.”

Many analysts call him as the “Goldilock” and he did that role again, easing investors on their worries about inflation and the health of the economy.

Today’s meeting indicated his bi-partisan support to get the confirmation to be the second term chair of the Fed’s office. Fed Vice Chairman Richard Clarida announced Monday that he is resigning a few weeks ahead of the end of his term following additional disclosures about his buying and selling of equity funds. Regional Fed presidents Eric Rosengren of Boston and Robert Kaplan of Dallas resigned in 2021 following similar disclosures.

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