Markets opened red on Wednesday ahead of the long-anticipated Fed rate hike.
After the hike was announced, +0.25%, markets moved towards flat. The Federal Funds rate is now 4.5 to 4.75%.
Then Fed Chair Powell took the stage. He said…
- “The disinflationary process has started”
- “A couple of more rate hikes … we think is appropriate”
He left the possibility of fewer hikes open … When asked if rates could remain below 5%, he responded.
- It’s “certainly possible”
The market clung to every possibility-dovish word and spiked higher into the close. The final results for the day…
- Dow Jones +0.0%
- Nasdaq +2.0%
- S&P 500 +1.0%
- Russell 2000 +1.5%
12 of the 30, or 40%, of Dow components, ended the day lower.
Compare that to the broader market, which saw 71% of stocks rally and just 25% decline.
Money appears to be rotating away from the security of the large caps and towards high-risk stocks in the Nasdaq and Russell 2000.
Sector Round Up
9 of 11 sectors ended Wednesday higher.
At the top…
- Technology (XLK) +2.4
- Consumer Discretionary (XLY) +1.9%
- Communications (XLC) +1.2%
At the bottom…
- Financials (XLF) -2.0%
- Energy (XLE) 0.0% — flat
Facebook parent Meta Platforms (META) is up 19% in premarket trading. This after announcing earnings last night.
- Revenue came in above Wall Street expectations at $32 billion
- $40 billion will go toward stock buybacks
- The gains, if they hold, will add $65 billion in market cap
AI chatbot ChatGPT has been making headlines across the tech world. This week Wall Street has taken notice.
Sympathy plays are emerging as the bull market heats up. Here are some stocks to consider…
- C3.ai (AI)
- Veritone (VERI^)
- Innodata Inc. (INOD)
Bitcoin^ made new 6-month highs overnight.
- The world’s largest cryptocurrency briefly rose above $24,000 for the first time since August 2022
Nearly bankrupt, Carvana (CVNA) is in meme stock rally mode…
- This morning, the stock is trading above $16
- That’s a 330% increase above December’s lowest close
Former meme stock Bed Bath & Beyond (BBBY^) missed a payment yesterday, according to the Wall Street Journal.
- The stock is up 8% in premarket trading
- It’s down about 90% from last year’s highs
- According to the report, bankruptcy is likely
You don’t have to look far to find a bear. But for the market to crash, you need fear.
The current market has none.
The VIX, aka the “fear gauge,” made new 52-week lows after the Fed’s latest moves.
The market is surrendering to greed. Our outlook is extremely bullish.
Our latest reading…
- The Put-to-Call Ratio is neutral
- Half of the RSI levels we track are now overbought
It’s big tech earnings day. After the closing bell this afternoon, we’ll hear from…
- Amazon (AMZN)
- Apple (AAPL)
- Alphabet (GOOG, GOOGL)
*CETX support at $10
*MSGM on watch
*CUEN support at $1
*MGAM on watch
*GAME resistance at $1.75
*UIHC on watch
SY support at $2.50
^AEHR support at $30
CABA support at $12
^VERI support at $9
DPRO on watch
LPG support at $21
TBBK support at $32
APLD support at $3
CBAY support at $8
HUYA support at $6
TOUR resistance at $2.50
Secondary watchlist, stocks with 100+ million float.
SUMO support at $11, resistance at $12
TGTX on watch
WB resistance at $25
OI support at $20
HIMS support at $8
AMLI support at $3.30
PTON support at $15
IQ support at $7
TUYA support at $2.75