Indices
- Dow 41,985, +97 or+0.23%.
- Nasdaq 17,784, +30 or+0.17%.
- S&P 5,667,+29or+0.51%.
- MSCI EAFE2484.98, +18.43 or+0.75%.
- USD10Y4.252%, -5.6bp or-1.30%.
- WTI Crude $68.28/bbl, +$1.10 or+1.64%.
Fed Holds Fast but Cuts Growth Expectations
As expected, the Fed kept rates unchanged during their mid-week meeting. However, they did cut their GDP growth expectations by 19% from +2.1% to +1.7%. In their statement the committee noted that “the uncertainty around the economic situation has increased.”They also released their dot plot chart which still assumes two additional 25bp rate cuts this year. However, on the margin, the dot plot chart is turning more conservative as four members now see no rate cuts in 2025, up from only one in December. Finally, the committeetrimmed its Quantitative Tightening program which could in effect act as a mini rate cut.
The S&P 500 avoided a fourth consecutive losing week, perhaps taking solace in the Fed’s dot plot chart. Meanwhile both FedEx (FDX) and Nike (NKE) reported and guided their respective Street earnings expectations lower.
The UpcomingWeek: Mar 24 – Mar 28
With only homebuilder KB Homes (KBH) and discount retailer Dollar Tree (DLTR) reporting earnings this week, the focus is on the economic data. Tuesday’s Consumer Confidence and Wednesday’s Durable Goods Orders will lend insight as to the state of the American consumer and Friday’s PCE report will provide additional data points regarding the Fed’s fight against inflation.
Economic Calendar
- Monday –March Flash U.S. S&P Manufacturing and Services PMIs. Earnings:KB Homes (KBH).
- Tuesday –March Consumer Confidence.Earnings:N/A.
- Wednesday–February Durable Goods Orders.Earnings:Dollar Tree (DLTR).
- Thursday – Initial Jobless Claims.Q4 GDP (second revision0.Earnings:N/A.
- Friday–February Personal Consumption Expenditure.Earnings:N/A.
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