What the Fed Decision Means for Markets (Near Term vs. Longer Term)
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What’s in Today’s Report:
- What the Fed Decision Means for Markets (Near Term vs. Longer Term)
Futures are sharply higher (up nearly 2%) as the Fed’s rate cut sparked a large global stock market rally (most major global indices are 1% – 2% higher).
Economically, there were no notable reports overnight.
Geopolitically, concerns are rising about a direct Israel/Hezbollah war, although investors are ignoring those increased risks, for now.
Today will be another busy day as there are two prominent central bank meetings and important economic data. First, there is a BOE Rate Decision (E: No change) this morning but, more importantly, there’s a Bank of Japan rate decision late tonight. The BOJ isn’t expected to raise rates but if they do (like in July) that could inject volatility into the markets (like it did in July).
Economically, there are two especially notable reports today, Jobless Claims (E: 230K) and Philly Fed (E: 2.0), while we also get Existing Home Sales (E: 3.90 million) and Leading Indicators (E: -0.3%). With the Fed now having cut 50 bps, the stronger the data, the better, as it’ll increase soft landing expectations.
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