Rally May Fizzle Without the Banks

Federal Reserve policymakers removed the word “patient” from their language on Wednesday, indicating that a rate hike may be a reality in coming months. By so doing, they released the proverbial kraken as most risk assets rallied and the U.S. dollar got smoked. In typical Fed fashion, though, Chair Janet Yellen was quick to reiterate that any rate hike is far from decided and that it remains data dependent.

When it was all said and done, the Russell 2000 closed the day at a fresh all-time high and the S&P 500 finished just 1% shy of its peak. The rally was led by energy and utility stocks, which makes sense given the sharp drop in the dollar and yields.

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