What were the performances of the U.S. stock market and the A-share market in the year following the Fed's interest rate cuts in history?

Over the past 50 years, the Federal Reserve has cut interest rates a total of 10 times. CNBC PRO

provided data on the performance of U.S. stocks in the 3, 6, and 12 months following each rate cut.

    The median increases at 3 months, 6 months, and 12 months were 6.4%, 9.8%, and 15.6%, respectively—double the market average.

    Federal Reserve rate cuts are usually accompanied by economic recessions, and historical data supports this: 6 out of 10 rate cuts led to recessions.

    The years when rate cuts resulted in a soft landing without a recession were 1984, 1989, 1995, and 1998. During these four years, the median increases at 3, 6, and 12 months were 8.6%, 13.3%, and 19.8%, respectively—even stronger performance.

    This rate cut is likely similar to those four years, and I personally believe a soft landing is more probable.
 

    Summary: Whether or not a recession occurs, U.S. stocks tend to rise in the year following a rate cut.

      So, how does the A-share market perform after Fed rate cuts? Does the liquidity really flow into our market as some "experts" claim?

      I couldn’t find authoritative media statistics on A-share performance in the year following Fed rate cuts, only data from content creators covering the last five rate cuts.

      The sample size is too small to be representative, and the economic cycles of the U.S. and China differ.

    But the data contradicts the common belief that Fed rate cuts benefit the A-share market.

      I’ve mostly given up on A-shares this year, occasionally trading options to offset losses—though the gains from options can’t cover the losses from my A-share holdings.

      My gains from Hong Kong and U.S. stocks this year are nearly 63%, almost offsetting my A-share losses.

    I haven’t written about Hong Kong IPO subscriptions in a while—the market has been weak, and many companies have undisclosed risks to list. I can’t write about what I know but can’t disclose, so I just trade privately.

Apart from a few high-risk stocks, I mainly subscribed to Lao Feng Xiang and Midea Group this year. I sold part of my Midea position before writing this but kept a small portion to see if it can rally further. $MIDEA GROUP(00300.HK) $LAOPU GOLD(06181.HK)