U.S. markets showed strength on Tuesday following 3 sessions of heavy selling pressure as the start of the Fed’s 2-day meeting on interest rates got underway. While most of Wall Street is expecting a quarter-point rate hike, the hope is the Fed’s language will soften for future rate hikes, or none, in 2019.
If the Fed decides to hold off on a rate hike, it will look as though the Fed caved to President Trump’s tweets on halting rates. Trump is ticked that the Fed is raising rates while he fights a trade war and the Fed is mad at Trump for waging a trade war while they raises rates. In any event, volatility stayed slightly elevated but held major resistance heading into the decision.
The Nasdaq added 0.5% after reaching a midday peak of 6,847. Lower resistance at 6,850-6,900 held with a move above 6,903 needed to get the index back into positive territory for the year.
The Dow rose 0.4% after testing an intraday high of 23,927. Near-term and lower resistance at 23,800-24,000 held with a death cross is in play as the 50-day moving average is just 36 points away from falling below the 200-day moving average.
The S&P 500 edged up a fifth-point, or 0.01%, following the run to 2,573. Fresh and lower resistance at 2,575-2,600 held with continued closes above the latter being a slightly bullish development.
The Russell 2000 slipped a point, or 0.1%, despite the opening run to 1,399. Fresh resistance and prior support at the 1,400 level held by a half-point with continued closes above 1,425 being a more bullish development for a possible near-term bottom.
Real Estate led sector strength after rising 1% while Technology and Consumer Discretionary advanced 0.8%.
Energy led sector laggards after tanking 2.4%. Consumer Staples and Health Care fell 1.2% and 0.9%, respectively.
Ametek (AME) and Fortive (FTV) were assumed at Overweight from Equal Weight at Morgan Stanley
Norfolk Southern (NSC) upgraded to Overweight from Neutral at JPMorgan
Host Hotels (HST) upgraded to Outperform from In Line at Evercore ISI
Philip Morris (PM) downgraded to Underperform from Neutral at Credit Suisse
Schneider National (SNDR) were downgraded to Neutral from Overweight at JPMorgan
Worldpay (WP) downgraded to Outperform from Top Pick at RBC Capital
Wednesday's earnings announcements (EST):
Before the open: General Mills (GIS), NCI Building Systems (NCS), Paychex (PAYX), Winnebago Industries (WGO)
After the close: Herman Miller (MLHR), Pier 1 Imports (PIR), Rev Group (REVG), Rite Aid (RAD), Twist Bioscience (TWST)
UPCOMING ECONOMIC NEWS
Wednesday's Economic Reports (EST):
MBA Mortgage Applications - 7:00am
Current Account - 8:30am
Existing Home Sales - 10:00am
FOMC Meeting Announcement - 2:00pm
METALS / OIL
Gold closed at $1,253.60 an ounce, up $1.80
Silver settled at $14.70 an ounce, down $0.06
Copper finished at $2.66 a pound, down $0.09
Crude Oil is at $46.03 a barrel, down $3.85
Bitcoin Investment Trust (GBTC) ended at $4.15
I hope this helps you prepare for the trading day. Make it a great one!
VIX Closes Above 25 Ahead of Fed Decision