📊 Rate Cuts and Stock Market Impact:
🔶 Historical Gains: Over the last 70 years, large-cap stocks gained +15.6% and small-cap stocks +26.6% on average within 12 months of the first rate cut.
🔶 Short-Term Effects: Within 6 months, large caps rose +9.4% and small caps +14.2% on average.
🔶 Recession Risks: In 2007, during a recession, the S&P 500 dropped 24% and the Russell 2000 fell 16% in 12 months after the first cut.
🔶 Outperformance: In the 2001 recession, small-caps gained 2% while the S&P 500 declined 14%.
Conclusion: If the Fed avoids a recession, history suggests potential upside for stocks ahead.