Markets were initially bifurcated as a rout in tech mega caps weighed heavily upon some of the indices. Bloomberg writes 90% of the companies in the S & P 500 gained yesterday even as the “Magnificent Seven” at one time sank over 3%, with the cohort ultimately closing about 1.1% lower.
Retail sales were released yesterday, a data point that suggested the consumer is slowing, a view amplified by a downward revision in February’s data. However, the “control group sales, which feed into the government calculation of goods spending for GDP, increased 1% last month, reversing the previous drop.
Tomorrow is the conclusion of the FOMC meeting. The markets are currently discounting 75 bps of easing by year’s end. Will the “dot plot” or the confidential estimates of each Fed member, support market expectations?
As noted many times, over the last several years there has been a sharp difference between market expectations and potential fed policy.
What will happen today?
Last night the foreign markets were up. London was up 0.37%, Paris up 0.48% and Frankfurt up 1.19%. China was up 0.11%, Japan up 1.20% and Hang Seng up 2.46%.
Futures are down about 0.35% ahead of the Fed meeting and rising Middle East tensions. Oil is up about 1.5%. The 10-year is off 2/32 to yield 4.31%.
Kent Engelke
Chief Economic Strategist Managing Director
The views expressed herein are those of Kent Engelke and do not necessarily reflect those of Capitol Securities Management. Any opinions expressed are statements of judgment on this date and are subject to certain risks and uncertainties which could cause actual results to differ materially from those currently anticipated or projected. Any future dividends, interest, yields and event dates listed may be subject to change. An investor cannot invest in an index, and its returns are not indicative of the performance of any specific investment. Past performance is not indicative of future results. This material is being provided for informational purposes only. Any information should not be deemed a recommendation to buy, hold or sell any security. Certain information has been obtained from third-party sources we consider reliable, but we do not guarantee that such information is accurate or complete. This report is not a complete description of the securities, markets, or developments referred to in this material and does not include all available data necessary for making an investment decision. Prior to making an investment decision, please consult with your financial advisor about your individual situation. Investing involves risk and you may incur a profit or loss regardless of strategy selected. There is no guarantee that the statements, opinions or forecasts provided herein will prove to be correct. If you would like to unsubscribe from this e-mail distribution, please reply to this e-mail and indicate that you wish to unsubscribe in your response.
