November 2, 2022

Markets:

Stock futures slipped on Wednesday as investors braced for the Federal Reserve’s latest rate decision at the conclusion of its policy meeting.

Stock futures moved toward session lows following the release of better-than-expected private payrolls data for October.

The Fed is widely expected to announce a 0.75 percentage point rate increase, its fourth hike in a row of that size as it battles high inflation. Investors are also looking for a signal that the central bank is prepared to slow the pace of its rate-hiking plan come December.

Comments from the Federal Reserve and Fed Chair Jerome Powell will play a key role in deciphering where stocks go in the months ahead and whether markets kick off a fresh bull run.

The central bank’s decision will come after the release of mixed economic data on Tuesday.

The ISM manufacturing index showed the share of companies reporting expansion in October come in slightly ahead of expectation, while the JOLTS report conveyed a strong labor market despite the Fed’s aggressive tightening clip.

In other economic news, mortgage application data for last week came in flat despite a slight tick lower in rates.

European markets were cautious on Wednesday as global investors focused on the conclusion of the Fed’s policy meeting.

Portfolio:

We enter the new trading session holding positions in CAE, PLTR, FIGS, SNAP, and ALLY.  Today, extreme patience is needed until the fed release and even after that – friendly reminder – it will swing as markets digest the release and as the Fed Chair speaks.  Typically, the first reaction is the wrong reaction.  Just keep this in mind.  It's easy to get sucked into the price action presented on Fed day but as history has shown us, it's best to allow it to be released and digested before moving forward.  Regardless, this event lays the foundation for weeks to come, possibly year end.  This is what really excites us!  Be on alert for further updates as needed.  Let's have a great session.