Dow rose 80 (but off the highs), advancers over decliners about 5-4 & NAZ added 13. The MLP index went up 1+ to the 272s & the REiT index was fractionally higher in the 358s. Junk bond funds fluctuated & Treasuries advanced. Oil dropped to the 56s & gold shot up 15 to 1257 after the rate decision..
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](http://www.kitco.com/images/live/gold.gif?0.23687335312738578)
Federal Reserve officials followed thru on an expected interest-rate increase & raised their forecast for economic growth in 2018, even as they stuck with a projection for 3 hikes in the coming year. “This change highlights that the committee expects the labor market to remain strong, with sustained job creation, ample opportunities for workers and rising wages,” Chair Janet Yellen said. In her final scheduled press conference before before stepping down on Feb 3, Yellen also said she would do her utmost to ensure a smooth transition to her nominated successor, Jerome Powell. In a key change to its statement announcing the decision, the FOMC omitted prior language saying it expected the labor market would strengthen further. Instead, this missive said monetary policy would help the labor market “remain strong.” That suggests Fed officials expect improvement in the job market to slow. The yield on 10-year Treasury notes was little changed after the Fed announcement. The 7-2 vote for the rate move, the 3rd this year, raises the benchmark lending rate by a qtr percentage point to a target range of 1.25-1.5%. In another move that could tighten monetary conditions, the Fed confirmed that it would step up the monthly pace of shrinking its balance sheet, as scheduled, to $20B beginning in Jan from $10B. Thru the policy adjustments & the statement, the Fed continued to seek a delicate balance between responding to positive news on growth & unemployment that encouraged gradual tightening, while signaling caution due to persistently weak inflation readings that have befuddled policy makers. Yellen is expected to chair next meeting on Jan 30-31 for what will be her last FOMC gathering of her time on the committee spanning 3 decades as chair, vice chair, San Francisco Fed pres & governor.
Fed Raises Rates While Keeping Three-Hike Outlook for 2018
House & Senate GOP leaders forged an agreement on a sweeping overhaul of the nation's tax laws, paving the way for final votes next week to slash taxes for businesses, give many Americans modest cuts & deliver the first major legislative accomplishment to Pres Trump. Top GOP aides said lawmakers had reached an agreement in principle on the final package. A congressional aide said the deal was contingent on whether late changes to the bill still complied with budget rules adopted by both the House & the Senate. Lawmakers were waiting to hear back from analysts at the nonpartisan Joint Committee on Taxation. The final House-Senate compromise is on track to be unveiled this week. Asked if there is a deal in principle on the tax cuts, Sen. Orrin Hatch said, "It's more than that. I think we've got a pretty good deal." The measure would give Trump his first major victory in Congress & it fulfills a longstanding goal by top Reps such as House Speaker Paul Ryan to rewrite the loophole-cluttered tax code. As Trump met with lawmakers at the White House, he said they were getting "very, very close to a historic legislative victory." The measure has come under assault by Dems who say it is unfairly tilted in favor of business & the wealthy.
British lawmakers have delivered a defeat to Prime Minister Theresa May's Brexit plans by giving Parliament the final say on any exit agreement with the EU. The House of Commons voted 309-305 to inserting Parliament in the Brexit process & deal another blow to May's already fragile authority. Several lawmakers from May's governing Conservative Party sided with the opposition to insist that any a deal with the EU require an Act of Parliament before it can take effect - essentially giving lawmakers a veto on Brexit. May had promised lawmakers a "meaningful vote" on Britain's withdrawal agreement, but opponents said that was not enough of a guarantee. The vote came as an amendment to the EU Withdrawal Bill. The gove flagship piece of Brexit legislation, it converts 12K EU laws into British statute on the day the UK leaves the bloc in Mar 2019.
Things are looking up for the ECB. The 19-country eurozone economy is gathering speed. Higher oil prices should boost still-sluggish inflation, the bank's chief concern. And, so far, financial markets haven't panicked over the bank's Oct 26 decision to scale back its bond-purchase stimulus program, to €30B ($35B) a month from €60B starting in Jan. Analysts aren't expecting big changes at tomorrow's meeting of the bank's policy council in Frankfurt. Instead, they will scrutinize Pres Mario Draghi's remarks at the post-decision news conference for more hints about precisely how & when the bank might finally bring the stimulus to an end next year. The ECB will release its first inflation projection for 2020 — a key indicator of whether the bank thinks it is achieving its mission of keeping annual inflation close to, but less than, 2%. Analysts predict 2020 inflation of 1.8%, pretty close to the bank's target.
Stocks took the rate news fairly well. There was selling into the close, but the Dow finished at another record high. It wants to get to 25K, hoping by year-end. But that will require cooperation from those guys in DC, especially in the Senate. At a minimum, 50 of the Senators have to vote yes & that will remain uncertain until the vote is taken next week (around Christmas eve).
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Federal Reserve officials followed thru on an expected interest-rate increase & raised their forecast for economic growth in 2018, even as they stuck with a projection for 3 hikes in the coming year. “This change highlights that the committee expects the labor market to remain strong, with sustained job creation, ample opportunities for workers and rising wages,” Chair Janet Yellen said. In her final scheduled press conference before before stepping down on Feb 3, Yellen also said she would do her utmost to ensure a smooth transition to her nominated successor, Jerome Powell. In a key change to its statement announcing the decision, the FOMC omitted prior language saying it expected the labor market would strengthen further. Instead, this missive said monetary policy would help the labor market “remain strong.” That suggests Fed officials expect improvement in the job market to slow. The yield on 10-year Treasury notes was little changed after the Fed announcement. The 7-2 vote for the rate move, the 3rd this year, raises the benchmark lending rate by a qtr percentage point to a target range of 1.25-1.5%. In another move that could tighten monetary conditions, the Fed confirmed that it would step up the monthly pace of shrinking its balance sheet, as scheduled, to $20B beginning in Jan from $10B. Thru the policy adjustments & the statement, the Fed continued to seek a delicate balance between responding to positive news on growth & unemployment that encouraged gradual tightening, while signaling caution due to persistently weak inflation readings that have befuddled policy makers. Yellen is expected to chair next meeting on Jan 30-31 for what will be her last FOMC gathering of her time on the committee spanning 3 decades as chair, vice chair, San Francisco Fed pres & governor.
Fed Raises Rates While Keeping Three-Hike Outlook for 2018
House & Senate GOP leaders forged an agreement on a sweeping overhaul of the nation's tax laws, paving the way for final votes next week to slash taxes for businesses, give many Americans modest cuts & deliver the first major legislative accomplishment to Pres Trump. Top GOP aides said lawmakers had reached an agreement in principle on the final package. A congressional aide said the deal was contingent on whether late changes to the bill still complied with budget rules adopted by both the House & the Senate. Lawmakers were waiting to hear back from analysts at the nonpartisan Joint Committee on Taxation. The final House-Senate compromise is on track to be unveiled this week. Asked if there is a deal in principle on the tax cuts, Sen. Orrin Hatch said, "It's more than that. I think we've got a pretty good deal." The measure would give Trump his first major victory in Congress & it fulfills a longstanding goal by top Reps such as House Speaker Paul Ryan to rewrite the loophole-cluttered tax code. As Trump met with lawmakers at the White House, he said they were getting "very, very close to a historic legislative victory." The measure has come under assault by Dems who say it is unfairly tilted in favor of business & the wealthy.
AP sources: House, Senate leaders reach deal on tax package
British lawmakers have delivered a defeat to Prime Minister Theresa May's Brexit plans by giving Parliament the final say on any exit agreement with the EU. The House of Commons voted 309-305 to inserting Parliament in the Brexit process & deal another blow to May's already fragile authority. Several lawmakers from May's governing Conservative Party sided with the opposition to insist that any a deal with the EU require an Act of Parliament before it can take effect - essentially giving lawmakers a veto on Brexit. May had promised lawmakers a "meaningful vote" on Britain's withdrawal agreement, but opponents said that was not enough of a guarantee. The vote came as an amendment to the EU Withdrawal Bill. The gove flagship piece of Brexit legislation, it converts 12K EU laws into British statute on the day the UK leaves the bloc in Mar 2019.
The Latest: UK lawmakers defeat government on Brexit bill
Things are looking up for the ECB. The 19-country eurozone economy is gathering speed. Higher oil prices should boost still-sluggish inflation, the bank's chief concern. And, so far, financial markets haven't panicked over the bank's Oct 26 decision to scale back its bond-purchase stimulus program, to €30B ($35B) a month from €60B starting in Jan. Analysts aren't expecting big changes at tomorrow's meeting of the bank's policy council in Frankfurt. Instead, they will scrutinize Pres Mario Draghi's remarks at the post-decision news conference for more hints about precisely how & when the bank might finally bring the stimulus to an end next year. The ECB will release its first inflation projection for 2020 — a key indicator of whether the bank thinks it is achieving its mission of keeping annual inflation close to, but less than, 2%. Analysts predict 2020 inflation of 1.8%, pretty close to the bank's target.
European Central Bank in no hurry to yank stimulus
Stocks took the rate news fairly well. There was selling into the close, but the Dow finished at another record high. It wants to get to 25K, hoping by year-end. But that will require cooperation from those guys in DC, especially in the Senate. At a minimum, 50 of the Senators have to vote yes & that will remain uncertain until the vote is taken next week (around Christmas eve).
Dow Jones Industrials
No comments:
Post a Comment