What the Fed Decision Means for Markets

What’s in Today’s Report:

• What the More Hawkish Than Expected Fed Decisions Means for Markets
• EIA Analysis and Oil Market Update

Futures are modestly lower as markets digest yesterday’s more hawkish than expected FOMC meeting.

The U.S. dollar is surging this morning off the more hawkish than expected Fed and gold is getting hit hard as currency markets re-price for a less dovish Fed.

Economically the only notable number was the Australian Labour Force Survey, which handily beat expectations (115k job adds vs. (E) 30k), reflecting the global nature of the economic recovery.

Today there are two notable economic reports, Jobless Claims (E: 364K) and Philadelphia Fed manufacturing Index (E: 30.8) but unless either number is a substantial surprise, they shouldn’t move markets.  Instead, markets will be watching the dollar and Treasury yields for reaction to the Fed.  If both rally hard throughout the day, that will pressure stocks further as it erodes some of the “dovish Fed” support that’s helped the S&P 500 rally to recent highs.