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Daily Market Update – March 16, 2016 (Close) Once again, the previous day did nothing to get 2016 closer to the breakeven point, but at least it didn’t push things further out of reach. By the looks of the futures this morning, we might yet get to say the same thing, except that at 2 PM there was a scheduled big event and then maybe an even bigger one beginning about 30 minutes later. Those would be the FOMC Statement release and Janet Yellen’s press conference, respectively. What the market did yesterday was to dispense with the customary pre-FOMC rally, as stocks again followed oil. First lower, but then recovering from a triple point loss to end with another visit to the baseline. Today, it may just be a case of “wait and see” as no one really put themselves out on the line in advance of today’s events. That was definitely the case as oil was sharply higher early in the morning before stocks opened and stocks decided not to play along. I certainly didn’t feel like adding any risk with what could be a very big unknown, even as most expect no change in policy. Sometimes, it’s not the change that makes the difference. Often it’s the nuance contained in the FOMC Statement and when there also happens to be a press conference, any single word can cause gyrations. Unfortunately, those surprises that may come are not only unpredictable in their own rights, but the reactions are equally unpredictable and subject to multiple reversals. Today, as expected, there was no increase in rates, but what may have come as a surprise was the news that there would likely be fewer than originally expected increases for the year. The market interpreted that positively, without thinking that means that the economy isn’t growing as had been expected. I look at that as bad news. Maybe at some point so will others. At the moment, I just hope to be in a somewhat better position to get some rollovers of the 2 positions expiring this week and perhaps adding to the dividend income for the week. So, that’s not asking for much, but the market hasn’t given too much lately, anyway, leaving expectations low. Lately Janet Yellen hasn’t sent markets higher, but I expected that she might have been able to help things out today, especially if the net result of the initial reactions to the FOMC Statement were negative. She does have a way of mollifying what could be perceived as bad news. Instead, she neither helped nor hurt, although maybe on a net basis she helped, except that the DJIA actually closed 2 points lower than when she started speaking, despite having spiked an additional 50 points beyond the close during the beginning of her question and answer session At least it was nice to think about something other than oil for a change . . < /p>< p> |
