Another week has gone by and our indices have continued breaking records.
Since the close of trading on Election Day, Nov. 8, the Nasdaq is up 4.7%, the Dow has tacked on 7.4%, the S&P is higher by 5.3% and the Russell 2000 has been a bat out of hell (apologies to Ozzy), higher by 16%.
Most market participants seem to have forgotten our Federal Reserve, which will loom large starting Tuesday (last Federal Open Market Committee meeting of 2016). As I have had said before, the Fed needs to get its rate hike done with and go gentle into that good night (apologies to the great Dylan Thomas here). Most importantly, I hope it doesn't start talking about how many hikes it wants to achieve next year and thus end up backing itself into a corner again.
Let's hope the Fed also has its eye across the pond with the existing issues in Italy and the soon-to-be-seen effects of Great Britain invoking Article 50 in the first quarter of next year. Of course, the actual pulling of the Article 50 trigger could come and go without too much global turmoil; however, that is far from a certainty and our Fed heads should be cognizant of that fact and recognize that their forecasts for rate hikes can still be thrown for a major toss. I think the Brits will rue their vote for Brexit before we see the end of 2017.
Another wild card is the fact that we still don't know exactly what President-elect Trump's fiscal priorities will be once he takes over in January, so better for the Fed to use its usual "data-dependent" speech and wait for the next meeting.
Next week on the economic data front here at home, there is nothing more important than the FOMC rate decision at 2 p.m. ET Wednesday, although the fact that it will raise rates by a quarter of a percent is built in here. What is not built in is if the Fed doesn't raise rates or raises rates by more than 0.25%. We shall see. Jeffrey Lacker, boss of the Richmond Fed, is scheduled to speak on Friday, and thankfully he is the only one next week, although I am sure they will be out in droves the week after.
On the international economic data front, we have Chinese industrial production data on Monday and Japanese manufacturing PMI on Wednesday to look out for.
On the earnings front, we will hear from VeriFone (PAY) on Monday after the closing bell. On Thursday, also after the close, Adobe (ADBE) , Jabil (JBL) and Oracle (ORCL) will shine the light on their earnings and provide guidance going forward. There are also a handful of non-tech earnings next week for investors to contend with. (Adobe is part of TheStreet's Action Alerts PLUS portfolio.)
On the lighter side:
One night a policeman saw an economist looking for something by a light pole. He asked the economist if he had had lost something. The economist said, "I lost my keys over in the alley." The policeman asked him why he was looking by the light pole. The economist responded, "It's a lot easier to look over here."
With that, I wish each and every one of you a safe and joyful weekend with your loved ones.
Go Cowboys!
