Whats moving the Market today?
Biotechnology outperforms & Crude oil pressured once again
Strong today: Health Care, Technology
Weak today: Energy, Financials, Industrials, Materials, Telecom Services, Utilities
Is there going to be another Q.E. under a different name
Follow thru from Wed. FOMC meeting showed the strengthening greenback has been a key factor in markets, sending ripples through U.S. equities, as traders worry about its impact on the profits of multinationals. The strong dollar has also fanned fears about deflation, as it pounded commodities markets, like oil and gold and weighed on emerging markets.
The dollar index slumped as much as 3 percent in the worst sell off in six years, after a dovish U.S. central bank on Wednesday pared back its own forecasts for interest rate hikes, cut its outlook for inflation and warned the economy has been moderating. The euro hit a high of about $1.10 to the dollar, in Wednesday afternoon trading, from a low point of $1.05.
Fed officials pared back their rate hike forecasts to a slower and lower trajectory. They basically cut the midpoint expectation for 2015 in half, with a year-end rate of about 0.6 percent. The central bank also forecast inflation would slow to half its prior projection—or 0.6 to 0.8 percent for 2015. Fed officials also reduced expectations for the longer-run unemployment rate to 5 to 5.2 percent, from 5.2 to 5.5 percent. It also tweaked its growth forecast, trimming it to 2.3 to 2.7 percent for 2015 from 2.6 to 3 percent, and warned that export growth has weakened.
My concern is if they dont raise rates, which they shouldn’t without any inflation to give cause to raise it, then the other tool they can use Q.E. But they probably dont want to label it that because it would scare the masses here and look like we haven’t recovered. So how will the feds package the new Q.E. under a different name. They really need to get inflation in order to raise them rates so they have something to lower for the next crash. Maybe thats a reason for feds promoting raising the minimum wages. Because that will cause a domino effect on inflation. Higher labor expenses increase prices to consumers. But it can also cause lower spending and send economy downhill.
Anyway todays current status:
The major averages are mixed at midday with the Nasdaq (unch) holding a slim gain while the Dow (-0.7%) and S&P 500 (-0.6%) trade near their session lows. today’s return of dollar strength has weighed on crude oil, sending the energy component into the lower half of yesterday’s trading range. At this juncture, WTI crude is lower by 3.2% at $45.17/bbl while the energy sector (-1.8%) sits at the bottom of the leaderboard.
Economic data included Initial Jobless Claims, Current Account Balance, Leading Indicators, and Philadelphia Fed Survey:
The initial claims level increased to 291,000 from an upwardly revised 290,000 (from 289,000) while the Briefing.com consensus expected an increase to 293,000
There were no special factors impacting this week’s claims reading. Volatility in the claims data has made it difficult to determine labor market conditions.
Philadelphia Fed’s Business Outlook Survey dropped slightly to 5.0 in March from 5.2 in February
shipments—or production—moved into a deep contraction in March as the related index dropped to -7.8 from +8.1 in February.
New orders growth slowed as that index fell to 3.9 in March from 5.4 in February. Unfilled orders entered an even larger contraction, dropping from +7.3 in February to -13.8 in March.
Tackle Trading LLC (“Tackle Trading”) is providing this website and any related materials, including newsletters, blog posts, videos, social media postings and any other communications (collectively, the “Materials”) on an “as-is” basis. This means that although Tackle Trading strives to make the information accurate, thorough and current, neither Tackle Trading nor the author(s) of the Materials or the moderators guarantee or warrant the Materials or accept liability for any damage, loss or expense arising from the use of the Materials, whether based in tort, contract, or otherwise. Tackle Trading is providing the Materials for educational purposes only. We are not providing legal, accounting, or financial advisory services, and this is not a solicitation or recommendation to buy or sell any stocks, options, or other financial instruments or investments. Examples that address specific assets, stocks, options or other financial instrument transactions are for illustrative purposes only and are not intended to represent specific trades or transactions that we have conducted. In fact, for the purpose of illustration, we may use examples that are different from or contrary to transactions we have conducted or positions we hold. Furthermore, this website and any information or training herein are not intended as a solicitation for any future relationship, business or otherwise, between the users and the moderators. No express or implied warranties are being made with respect to these services and products. By using the Materials, each user agrees to indemnify and hold Tackle Trading harmless from all losses, expenses and costs, including reasonable attorneys’ fees, arising out of or resulting from user’s use of the Materials. In no event shall Tackle Trading or the author(s) or moderators be liable for any direct, special, consequential or incidental damages arising out of or related to the Materials. If this limitation on damages is not enforceable in some states, the total amount of Tackle Trading’s liability to the user or others shall not exceed the amount paid by the user for such Materials.
All investing and trading in the securities market involves a high degree of risk. Any decisions to place trades in the financial markets, including trading in stocks, options or other financial instruments, is a personal decision that should only be made after conducting thorough independent research, including a personal risk and financial assessment, and prior consultation with the user’s investment, legal, tax and accounting advisers, to determine whether such trading or investment is appropriate for that user.