federal reserve: Taper no grounds for tantrum to stock bulls wielding $28 billion

 federal reserve: Taper no grounds for tantrum to stock bulls wielding $28 billion
The thought of central bank policy makers easing off their campaign to liquefy bond markets has hung like a sword over equity investors for years. At least at the earnings level, there may be less reason for anguish than is usually recognized.

Research from UBS Group AG says that should the Federal Reserve turn off the spigot on its annual $1.4 trillion in quantitative-easing spending, the hit to the S&P 500 Index would be a 3% decline in prices. That’s a relatively paltry headwind for companies whose combined earnings growth analysts put at roughly 10% in each of the next two years.

While the precision of such forecasts is famously squishy, they could be framed as justifying some of the resolve retail investors have evinced over a period of steadily rising Fed hawkishness. Stock bulls just pumped $28 billion into equity exchange-traded funds in the past week, about three times the 2021 average, data compiled by Bloomberg show.

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