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On Wednesday afternoon, the Federal Reserve raised its key interest rate by another 0.75 percentage points in response to hotter-than-expected inflation, extending gains for stocks following the news. All three major U.S. indices traded higher to start the day but finished with an added boost after the announcement: Dow up 1.37%, S&P up 2.62%, and Nasdaq up 4.06%. Just yesterday, shares sold off as inflation data continued to pressure markets. The Federal Open Market Committee (FOMC) voted to raise the federal fund’s target range to 2.25% to 2.5% during its July meeting, which was announced by Fed Chair Jerome Powell following the conclusion of the two-day meeting. The Fed also stated that it expected “permanent adjustments in the target range” to be appropriate. Additional economic reports impacting markets today included durable goods which increased in June by 1.9% as well as the latest earnings releases.
Despite missing earnings expectations, both Alphabet and Microsoft reported good results on Tuesday night. Both stocks rose as a result of quarterly revenue growth. Boeing and Facebook parent company Meta Platforms are among the businesses reporting earnings on Wednesday. Visa and Kraft Heinz saw shares sell-off following results while Chipotle and Hilton’s shares grew impressively. Amazon and Apple will headline Thursday’s releases; Comcast, MasterCard, Pfizer, Hersey, Hertz, Intel, Southwest Airlines, and Exxon are set to release earnings on Thursday and Friday this week.
Apart from the mega-cap earning releases, GDP data on Thursday, and continued reaction to today’s FOMC decision, can influence the next move in the market. We’re keeping an eye on the SPY’s overhead resistance levels, which are presently at $401 and $409. The $SPY support is at $390, and then $380. We expect the market to continue its short-term advance for the next several weeks while monitoring VIX levels, which are near the $24 level. Globally, Asian markets finished with mixed results while European markets closed in the green. We encourage all market commentary readers to maintain clearly defined stop levels for all positions. For reference, the SPY Seasonal Chart is shown below:
Note: The Vector column calculates the change of the Forecasted Average Price for the next trading session relative to the average of actual prices for the last trading session. The column shows the expected average price movement “Up or Down”, in percent. Trend traders should trade along the predicted direction of the Vector. The higher the value of the Vector the higher its momentum.
*Please note: At the time of publication Vlad Karpel does have a position in the featured symbol, SH. Our featured symbol is part of your free subscription service. It is not included in any paid Tradespoon subscription service. Vlad Karpel only trades his money in paid subscription services. If you are a paid subscriber, please review your Premium Member Picks, ActiveTrader, or MonthlyTrader recommendations. If you are interested in receiving Vlad’s picks, please click here.
West Texas Intermediate for Crude Oil delivery (CL.1) is priced at $98.10 per barrel, up 3.28%, at the time of publication.
Looking at USO, a crude oil tracker, our 10-day prediction model shows mixed signals. The fund is trading at $75.16 at the time of publication. Prediction data is uploaded after the market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.
The price for the Gold Continuous Contract (GC00) is up 0.89% at $1733.00 at the time of publication.
Using SPDR GOLD TRUST (GLD) as a tracker in our Stock Forecast Tool, the 10-day prediction window shows mixed signals. The gold proxy is trading at $160.04 at the time of publication. Vector signals show +0.25% for today. Prediction data is uploaded after the market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.
The yield on the 10-year Treasury note is down, at 2.790% at the time of publication.
The yield on the 30-year Treasury note is up, at 3.069% at the time of publication.
Using the iShares 20+ Year Treasury Bond ETF (TLT) as a proxy for bond prices in our Stock Forecast Tool, we see mixed signals in our 10-day prediction window. Prediction data is uploaded after the market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.
The CBOE Volatility Index (^VIX) is $23.24 at the time of publication, and our 10-day prediction window shows mixed signals. Prediction data is uploaded after the market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.
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