Can “turnaround Tuesday” extend to Wednesday? Early signs are pointing green. Spillover optimism rules the roost as investors wait to see if there’s a stimulus deal. The other big question of the day is whether the Fed can put together the right combination of words and deeds to keep things humming as it wraps up its meeting later on.
November’s retail sales came out before the open and didn’t do much for the optimism trade, falling more sharply than Wall Street had expected. The 1.1% decline was steeper than the negative-0.3% average estimate, but might actually put more pressure on Congress to act. Shutdowns and job losses appear to be taking a toll on consumers.
Besides stimulus and the Fed, Friday’s quadruple witching looms. All this combined raises the chance of some quick movements one way or the other over the next few days, so keep your seatbelts strapped. Tesla Inc (NASDAQ: TSLA) being added to the S&P 500 is another factor that could have large traders moving in and out of the market.
Volume could also pick up after the Fed meeting, as it sometimes does. The Fed is widely expected to leave things alone, but also to project a soothing vibe before going home for the holidays. That could mean pivoting to buy more longer-term bonds to keep mortgage and other borrowing costs down, but it’s not a slam dunk that will happen today. See more…
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