The market before Christmas staged a dramatic contrast. US Q3 GDP growth surged to 4.2%, far exceeding the 2.5% market expectation. This should have been enough positive news to drive the stock market higher. However, reality told a completely different story—the stock market not only failed to rise in response but instead fell into sideways or even downward movement.

Behind this "good news but no rise" phenomenon lies a policy game involving the market's direction.

From a data perspective, the 4.2% GDP growth is indeed impressive. This result far surpasses market expectations and should serve as a strong support for a stock market rally. But the market's performance tells another story. Wall Street is worried about the Federal Reserve possibly raising interest rates, fearing that the central bank might tighten policy to control inflation. This expectation gap directly suppresses the upward momentum of the stock market.

The divergence of opinions lies in the understanding of inflation. Some believe that strong economic growth could trigger inflation risks, necessitating an early rate hike. Others argue that inflation fundamentally stems from policy mistakes rather than robust growth, and with the market's self-regulating mechanisms, inflation will gradually ease. Blindly raising rates might instead hinder growth.

This face-off involves three key elements: the explosive economic data signaling growth; the cautious attitude of the stock market reflecting concerns over policy shifts; and the future policy choices of the Federal Reserve, which will directly impact whether the market can truly realize the potential of this economic data. The market's direction is being redefined within this triangular game.