Stock rally fanned by hopes of Fed ‘past peak hawkishness’

Expectations of Fed hawkishness have eased, with investors now pricing in a 35% probability that the Fed funds rate will be between 2.25% and 2.50% after its September meeting, down from a 50% probability a week ago, according to CME.

NEW YORK: Bad news may once again be good news on Wall Street, as signs of slowing US growth fan hopes that the Federal Reserve (Fed) may not need to tighten policy as much as previously expected.

Home sales have fallen for a third straight month, while big misses from retail giants such as Target Corp and Walmart Inc shook their share prices last week.