Breadth is almost exact even, with about 3100 advancers and decliners. There is no market reaction to the shooting in Washington and no major movement in anticipation of a Fed interest rate hike this afternoon. Volatility is suppressed and the computer programs are trading for pennies, rather than big moves.
What is particularly interesting today is that the iShares Barclays 20+ Year Treasury Bond Fund (TLT) is trading up sharply. That seems illogical, as there is a 97% chance the Fed is going to raise interest rates, but the market is anticipating that there will be some dovish comments. The chances of further rate hikes have declined.
It used to be that the Fed was a no-lose factor for the market. If the economy was weak, that meant rates would stay low and the cheap money would flow. If the economy was strong, that meant that we'd have better growth, but the Fed was still in no hurry to raise rates.
The bears believed that eventually a hawkish Fed would kill the market, but instead they are now more focused on the possibility that the inability of the Fed to raise rates because of anemic growth will be the problem.
The market seems to not worry much about the Fed one way or the other. What traders are really focused on is the price action. They want to see some shift in the way the market trades, so they can make some moves. You can't bet on news; you have to bet on what the algorithms or quants might do instead. There is no direct correlation between news events and market movement.
I have a few stocks that I'm looking to add to as they develop, but there isn't any reason to make moves right now. I'd like to add Health Innovations (HIIQ) , Alibaba (BABA) , The Trade Desk (TTD) and Applied Optoelectronics (AAOI) , but I don't see any reason to do so at this point. I either want to buy as support levels hold or when there is some positive action. Neither is occurring at this point.
