Anyone watching the stock market today most likely has their jaw slightly above floor level. Late in the afternoon trading session on Thursday, stocks began to pare losses. This bullish momentum continued into today with S&P Futures and Dow Futures pointing to a green open.
But Then It Happened…
Two minutes before the opening bell, both futures and ETFs (SPY + QQQ) saw an aggressive pullback. The trend is your friend until it isn’t in the stock market today. More times than not, investors have been left confused and upset.
Stock Market Today Offers More Volatility
To the surprise of investors, the markets rebounded in just as an incredible fashion. Seemingly on the words of NY Fed President giving a more dovish outlook to rates and the coming New Year. But does the Fed really know where we are? Probably not as many comments do not match up to the models, which don’t match up to the statements.
The Fed could be humbled before the fate of what will happen. Economists may not have it right either. Data is important right now and seemingly more valuable than what is being said on the news. This is at least for an investment outlook. As far as traders are concerned, the market is telling us that there may be a huge divergence between what it wants and what the Fed wants.
New York Fed President John Williams says the central bank is open to rethinking rate hikes next year, depending on how the economy looks in 2019. “What we’re going to be doing going into next year is reassessing our views on the economy, listening to not only markets but everybody that we talk to,” Williams told CNBC.
Do You Trust The Fed?
Multiple messages from two of the Fed officials were relatively different. Say what you will, today’s comments from Williams were far more dovish that Powell’s in my opinion. As we approach the New Year, the stock market will be watching for what comes next. Earnings could slow as some would expect after multiple record quarters. However, today, earnings from companies like Nike have helped boost sentiment.
Earnings News In The Stock Market Today: Nike Rallies
As cited from Barron’s, “Shares of Nike (NKE) are up more than 8% after hours, following its fiscal second-quarter earnings. The athletic apparel and footwear giant said it earned 52 cents a share, on revenue of $9.37 billion. Analysts were looking for EPS of 46 cents on revenue of $9.17 billion. Gross margins expanded 80 basis points at 43.8%, also ahead of the 43.5% consensus estimate.”