We’re On Thin Ice
It's not the time to celebrate the S&P's 6% rise in January. Nor is it time to celebrate a 25 bps hike from the Fed. It's time to carefully watch where we tread, as the market is on thin ice.
As everybody knows, attention today is going to be focused on the Fed, who is expected to raise interest rates by just a quarter point. The decision will be out at 2PM today.
Over the last couple of weeks, the stock market has regained its footing from both a technical perspective and an “animal spirits” perspective. The S&P is up 6% year to date.
Adding to the bullish momentum at the end of the day yesterday was the Wall Street Journal’s Nick Timiraos all but confirming the Fed’s plans for a 25 bps hike today - a move that many are viewing as extremely dovish. I couldn’t disagree more.