Markets ended Wednesday on lower prices, but modestly. The Quarter 1 advanced GDP number that was released pre-market came in missing estimates. This was another data point in a string of data points that suggests that the US Economy is not doing great. GDP was estimated at 0.2% which is near retraction levels. Not good. Stock prices started the day on a negative note, partly as a reaction to the GDP data, and partly as a spill-over from selling overseas. Equity prices in Europe sold off overnight.

The day was set to revolve around the FOMC policy statement at 2 pm EST. Once the committee released the statement, stock prices rebounded, the dollar sold and volatility picked up in general. But the moves were short lived and left traders still scratching their heads at the end of the day wondering what the market moves will head towards next. The FOMC reiterated the current policy statement and stated that they will remain dovish (my interpretation) until there is significant need to raise rates. It was a predictable statement – and leaves traders wondering what will happen in June. As of this statement, and in consideration of recent economic data points, it looks like they will not be raising rates in June. Its still out a few months, but unless something drastically changes between now and then they will probably stand pat.

Crude Oil was up big today partly as a reaction to crude oil inventories coming in smaller than expected inventory build, but mostly because the dollar had weakness early and the commodity built on that. Crude has key resistance in the high 50’s and 60 dollar price tag. Further weakness in the US dollar could trigger a rally in prices. Economic data to be aware of over the next few days – Thursday brings unemployment claims at 8:30 am EST and Friday has ISM manufacturing PMI at 10 am EST.

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