(As of 7:25 am PST)
Stocks are attempting to rebound this morning after
yesterday afternoon’s quick selloff caught investors by surprise. Markets closed lower Wednesday after Fed
Chair Janet Yellen signaled (perhaps mistakenly) that an interest rate hike
could come sooner than expected. In her
first policy statement as the new Federal Reserve Chair, Yellen surprised
markets by commenting that a rise in short term interest rates could come as
early as 6 months after the taper ends.
Some analysts are calling her transparent remarks a “rookie mistake” as
markets sold off on the unexpected announcement. The FOMC also determined to drop it’s 6.5%
target for unemployment before rates are hiked.
After trading flat most of the day Wednesday, markets sold off in the
afternoon. Stocks are rebounding today
on mostly positive economic reports.
Jobless claims rose slightly last week from 315,000 to 320,000. Existing home sales fell 0.4% in February to
the slowest pace since July 2012. These
reports were muted by a strong rebound by the Philly Fed index which showed
manufacturing activity improving well ahead of consensus estimates. A report on leading economic indicators also
came in strong. International markets
are mostly lower on Yellen’s comments yesterday. Gold is down 1% and interest rates are
ticking up slightly. We’ll see how well
the market digests Yellen’s comments from yesterday. It could be a choppy day
on Wall St.
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