Joe Saluzzi, partner and co-head of equity trading at Themis Trading, said US
inflation running hotter than expected is forcing a market reassessment and has
strengthened Fed tightening bets. He noted some Fed governors had signaled a
possible 50bps hike by year-end if inflation stays high; Saluzzi called 50bps
too large but said a 25bps move remains possible. The print underscores
inflation’s persistence; as long as rates and inflation remain elevated,
borrowing costs will stay under pressure, squeezing debt-reliant firms, denting
earnings and eventually weighing on equity prices — sustained pressure could
amplify downside for stocks.
