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FED Day is Here and It Should Be Interesting

Markets are very calm right now with equity futures pretty flat. Interest rates are universally higher with the 10 year at 3.62% which is up 14 basis points on the week.

The FOMC will announce the interest rate hike (or no hike) at 1 p.m. central time. But really the main event will be what Powell has to say at his news conference at 1:30 pm-central. Does Powell spook the market at the presser? Will he send mixed signals? We have no idea on these questions, but it is one of the few times we will have the TV on for a few minutes.

Yesterday we finally had buyers step in to the income arena with prices up a bit on the day. We had plenty of nervous nellies selling early yesterday at ‘get me out!’ prices. Hennessy Advisors baby bonds 4.875% (HNNAZ) is my best example. The issues fell $2.36/share on a 1000 share trade at $19.80, but a couple buyers (literally) stepped in and the issue closed at $22.96.

Yesterday one of my Tri-Continental preferred (TY-P) orders executed at $47.50. I have another GTC buy order at a lower price. I have another GTC buy order in on the GAMCO Natural Resources 5.2% preferred (GNT-A) at $21.xx–the issue bounced yesterday to close at $22.42.. My orders will remain in place–for the sock drawer.

So let’s get this day going and see what Jay Powell has to tell up in 6 hours.

4 thoughts on “FED Day is Here and It Should Be Interesting”

  1. Let’s see if the pattern of late repeats itself again.

    1) The Fed raises rates
    2) The market celebrate and leap higher for a couple days and the rate on 10 year goes down (why is a total mystery to me unless it is just a move to draw in suckers at a higher price)
    3) 2 or 3 days later the market reverses and all the gains disappear.
    4) 1-2 weeks later the market is funk wondering what to do.

  2. Tim, I will be watching as well, and simutanelusely watching the one minute SPY chart (more for entertainment).
    I expect it will take the equity and bond markets until at least the close to digest the news. Also intently watching the direction of bank stocks and a basket of IG preferreds.

    Cheers! WIndy

    1. windy—I have it (the 1 minute spy chart) up on my TDA accounts when I am here. Only a 1% spike – thought it would be more (one way or the other).

      1. Tim .. Windy ,,, Yes…but ,,in the right direction,,stocks down , blowing in Bonds and Preferred … for shelter , Georges PS.. o many good deals

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