Why does the positive impact of the Federal Reserve's pause in interest rate hikes outweigh the impact of rate cuts on the stock market?

The positive impact of the Federal Reserve's pause in interest rate hikes on the stock market outweighs the impact of rate cuts. Investors have been putting their funds into money market funds in a high interest rate environment, but this situation is expected to change. The Fed will maintain stable interest rates in its next policy actions, signaling the beginning of a "pause period" between rate hikes and cuts. During this period, investors should hold stocks instead of collecting interest in money market funds. Research shows that stocks provide the highest average annual returns during a pause period. At the same time, there are also opportunities in the bond market to take advantage of bond yields. In addition, investors should choose high-quality stocks with low leverage, stable earnings growth, and healthy balance sheets. In the long run, cash misses out on potential opportunities in the stock market.