Once again stocks started the day higher and by the close ended the day where it had started. All of this sideways action is a result of investors waiting for the Fed’s decision on interest rates on Wednesday which is released at 2:00 PM.
S&P Index Close
The S&P index closed virtually unchanged at 2139.76 up 0.64 points.
Dow Jones Index Close
The Dow Jones closed up 9.79 points to 18,129.96.
NASDAQ Index Close
The NASDAQ moved higher by 6.33 points to close at 5,241.35.
Stock Market Outlook for Tomorrow – Sep 21 2016
The technical outlook is not needed for Wednesday as the outlook hinges squarely on the Fed’s decision on interest rates. The majority of investors and the vast majority of analysts believe there will be no rate increase tomorrow. At the same time a surprise rate hike would stun the market on Wednesday. No rate hike should move the market higher, at least at the start of the announcement. There is still the potential for the market to pullback depending on the statement’s wording by the Fed.
A surprise rate increase would definitely send stocks lower. Based on the technical indicators at present, an initial drop might be expected to take out 2125 but depending on the severity of the reaction from investors, 2100 might be seen quickly, within a couple of days of an interest rate hike. Watch for the market to possibly climb before the announcement at 2:00 PM in anticipation of a no rate increase announcement. At the same time we could see a quick dips just moments before the 2:00 PM release.
Overall a rate hike in December makes far more sense from a less “shock” aspect as just about everyone expects a rate hike in December.
Caution is still warranted heading into the Fed’s interest rate announcement.
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