Oh where oh where will the market be heading? Oh where oh where can she go?
It is a good question. One that no one is quite sure how to answer. Things are looking like its time to sell off, however, all eyes are on a Fed decision on interest rates. How will this affect the markets? Yesterday, we saw a healthy dose of selling as buyers hit the sidelines. My guess is that a general market sell off continues in the morning as buyers still wait to jump into this thing prior to the Fed’s report this afternoon. It probably, however, will not be as bad.
Other key information we will be looking at is the report on trade balance. A bullish number here would be good for the markets and show the health of both the USA’s economy as well as global health. That report comes out at 8:30 AM. Additionally, the Treasury Dept. at 2:00 PM, just 15 minutes prior to the Fed report, will be announcing the budget deficit to the American public. Plus, at 10:30 AM, we have crude inventories coming out, which should definitely help give some direction to crude prices.
Across the pond, today, Europe was not threatened by yesterday’s sell off in America, and the markets are up, which is a healthy sign. However, Asia was hit hard by the problems in the American market, with the Hang Seng dropping over 3%.
However, it is hard to tell if these foreign markets will even have any affect, whatsoever, on the markets today because investors are very focused on the Fed report.Futures are up slightly heading into the trade balance report, and I think that if that number comes out positive, it will give the market enough for a slight lift.
Another reason to be positive, as well, is that this morning, Toll Brothers, a major residential construction company, reported that they saw their home contracts up instead of down in the latest quarter. It has sent the stock up over 7% in pre-market trading. It will definitely be a catalyst for that sector as a whole. However, SRS is not down significantly, and I don’t think this will have a great affect on a multitude of positions.
Therefore, my position today is that things are just very murky. A lot of capital is staying on the sidelines waiting for that report to come out. To be honest, I…
