FOMC And The Morning After Pill Effects
I was queuing for a list of stocks yesterday morning for a punt (those that I wrote about on Monday) and missed every single one of them as my broker tells me that markets rallied in a hurry at around 4 pm before close.
It was pretty much the same for the S&P 500 last night, grasping at straws, for straws and with straws.
Straws because the statement was nothing much, really, and mostly neutral with the possibility of a rate hike as early as April next year building up wihch means that we should stick to the long USD story as economic data continues to support the case.
My main concern was with the bonds and the 2 year T-note whose yield rose 6 bp on the day to close back above 0.6%, a magic 3 1/2 year high number that the market is watching closely.
For me, this FOMC is no more useful than an interlude in the current market turmoil, serving the purpose of a morning after pill, only good until the next night.
There is little in terms of market support for the crumbling oil assets and everything else to go along with it.
Yet, it has given the market a much needed recess from their panic attack and arrested the drop in oil prices.
And finally, Gold speaks for all, now back to square one.
If the S&P closes this month down, it will be the first December in 7 years that it has done so and margin debt in NYSE is showing signs of coming off its high.
The Fear and Greed index is on our side, at extreme Fear again which means it would be easy to rally back those losses on those stocks I wanted to buy yesterday but missed out !
I stand neutral to mildly bullish into year end.