Third Lévy Flight Of 2022 S&P 500 Sends S&P 500 Much Lower

It didn't take long for the S&P 500 (Index: SPX) to have a trading day qualify as "really interesting" by our standards, as Friday, 29 April 2022 delivered.

But what did it deliver after having already fallen off the proverbial edge? Simply put, investors have much more fully shifted their forward looking focus to 2022-Q2, thanks to increasing prospects the Fed will hike rates by three quarters of a point in June 2022. Here's how that growing realization looks on the dividend futures-based model alternative futures chart:

There's still room for the S&P 500 to fall lower, but without any erosion as yet in the expectations for future dividends, there's less immediate downside now than there was a week ago. The following market-moving headlines recap the random onset of new information that influenced the S&P 500's direction during the exciting and volatile week that was...

The CME Group's FedWatch Tool projects the Fed will hike rates by a half point in May and June (2022-Q2) and again in July and September (2022-Q3). After that, the FedWatch tool anticipates quarter point rate hikes at six-week intervals through March 2023.

The BEA reported real GDP in 2022-Q1 fell by 1.4%, which was quite different from the Atlanta Fed's GDPNow tool's final forecast for a real gain of 1.3%. As expected, the GDPNow tool has shifted its focus toward 2022-Q2, where it anticipates a positive 1.9% real growth rate with respect to the level of 2022-Q1's real GDP level.