Nasdaq Drops 1.3% as Tech is Hit
US markets took a bit of a hit yesterday as tech Stocks led the way down, the Nasdaq closed the day down 1.3% although the Dow remained strong up 0.27% and the S&P dropped 0.38%, all evidence of the market confusion ahead of the next Fed meeting. Stock market concerns were increased after the Bank of Canada raised rates, once again against expectations similar to the RBA the day before – investors are concerned that the FOMC will follow suit. The dollar increased against most of the majors as the market awaits inflation data and the Fed next week- the Cad being the exception after the BOC.
Investors Looking for More Information
It’s already been a long week for investors and there hasn’t been too much new information for them to digest. Most of the big players will have taken on board the fact that both the RBA and the BOC have raised rates against market expectations. The Bank of Canada raised rates to a 22-year high and investors took note. The clear message from central banks is that inflation is the main target and they will keep looking at that as a factor against all other issues in the short term. If we take that as a president then maybe a pause from the FOMC is not such a straight call.
Sentiment to Dictate Flow Today
It is a very quiet day across the macro-economic calendar today as investors digest the last few days input and assess what central bank messages we are getting. There are some tier 2 numbers out of Japan in the form of GDP and Current account data but do not expect too much impact from them. The European session sees some input from SNB Chair Thomas Jordan early in the day but that’s about it. In the US session, we have the weekly unemployment Claims numbers, expected to come out at 236K but most investors are expecting sentiment to dictate direction.
