Today. We start out of with the fed staying put. Jerome powell signaling the rates will stay near zero through 2023 stocks getting an initial pop, but reverse course as the fed share took questions from the press. Steve, what was it, do you think, that spooked the markets . You know, its always hard to know maybe one of those sell the news things there was a bit of history in the statement where the fed for the first time put in the statement that its new goal is to seek inflation above 2 that was in the longterm policy strategy but it had not yet been in the statement. This is the first statement following that change. It was a bit like there was nothing behind it in the sense that, the question that i asked, i said, well, how come your forecasts dont show you hitting the goal, not even in the fouryear horizon here the fed chair didnt really have a good answer for that you would think if you said, you know, im going to move this tanker faster, you know, youd be pushing the throttle do
News on the banks. We were discussing on closing bell the banks finding out this evening what this extra stress tests theyll go through this fall will be there will be two severe recessions it will be tested against as opposed to normally one. Its possible we could interpret those severe recessions as not as bad as they could have been june saw unemployment spiking to 10 . This test has two versions one is that it spikes to 12. 5 and then dips more quickly to 7 7. 5 both of those factors perhaps highlight the severely adverse scenario didnt get that much worse given the year that were in than perhaps it could have got. 10 unemployment to 11 or 12 is not that much worse. That will also include a stock market decline by 30 house prices falling 26 all of course headlinegrabbing changes but not that much worse than they could have been given the fact that we already knew this early set of tests was coming there is one line that stands out at the end of the statement that says, the board re
The dow industrials this wednesday morning are going to go up about 170 odd points at the opening bell. S p, modest gain. A fractional loss, though, for the nasdaq which is at the 11,000 level. Stocks overall getting help from the virus relief talks. Mitch mcconnell talking compromise. Senator schumer talking concessions from both sides. Theyre looking for a deal by the end of this week. My opinion, there is no way Congress Leaves Town friday without spending at least a trillion dollars. I think a deal is coming and the market likes it. Two stocks in the news and moving. Disney, up sharply despite losing 5 billion during the pandemic lockdown. Disney plus has 60. 5 million paid subscribers, 100 million overall and they are starting another streaming service next year. All of that helps. Disney is up seven. Novavax, their phase one trial showed their vaccine to be safe and created an immune response. That stock is way up, 30 bucks a share on the upside. All right. Something different. L
Equity prices higher, and the linkage to this economy and how bad it is has never been wider apart. Futures higher this morning. Interest rates are up as well. Lower at thelds front end, and a big bid for what is happening in germany. We will talk about that a little bit later in the program. Lisa, it is a rally across the continent and europe, too. Lisa particularly in italy, where you see yields come in further than in germany. Tomorrow, the European Commission will officially propose that 500 alien euro plan of a rescue financing. Very interesting to see what type of back and concessions have been put in there. Also, thursday, the National Peoples congress of china will be voting on that Controversial National security law for hong kong. Also on thursday, the initial u. S. Jobless claims. I am watching how much we see that number come down, how much these jobs become permanent losses at a time of reopening we are seeing right now. Jonathan more ugly data expected through the week, a
98 of the stocks to the downside s p 3,000, 10year yield at 1. 25 if you were right on this move, thats a really logical place to say, fine, let me cash in a little bit i think thats what we saw this morning. Not to guild d lily, but we were almost 1,000 points caterpillar has had a spurt in the last few minutes 3m has been positive merck and pfizer im not saying anything is turning around but some people are buying here. The problem is the information vacuum here. The old saying, you cant trade on fundamentals, trade on the technicals the problem is we cant trade on the fundamentals because we dont know what the earnings in the p e ratio should be right now. We saw that with the dispute with goldman going to zero percent Earnings Growth for 2020 then technical, everyone was saying were watching the 200day moving average, we went through that just after the open its hard to trade on fundamentals right now, hard to trade on the technical, and we need a lot more information on whats goin