While the Dow and S&P averages had moderate down days, the Nasdaq managed to break even on the day. Nothing is worrysome about todays action nor is it indicative of what looms tomorrow with the Fed decision due at 2:15pm. If you want to get the decision as soon as it comes out, there is an email service that you can subscribe to at www.federalreserve.gov or you can simply go to the site at that time when it comes out. Expected tomorrow at the very least is a strong knee-jerk reaction proceeded by heavy volume at the annoucement. But be careful, if you think you can play the Fed Decision, then be aware that often times the initial market direction can be wrong, and investors who thought they guessed right, end up being bag-holders for the rest of us. Its likely the Fed will cut rates by a quarter point, with chances of half point being unlikely. Though not expected, be prepared in the even that the Fed decides to not cut rates at all.
Today’s market actions can likely be attributed to investors taking profits ahead of a Fed decision or investors who are just plain nervous about general market conditions and don’t want to be on the wrong end of investor sentiment in the aftermath of what Bernanke & Co. decide to do with the Short-Term Interest Rates.
The only major economic piece of news today was the Consumer Confidence Index Report that came in at 95.6 versus an expected 99.5. The difference in the actual versus the expected could also be attributed to the decline in today’s market, but frankly we doubt it had much to do with it.
Lately, we have been seeing incredible volatility in Tech, and that is good, because much of that volatility has been to the upside and doesn’t seem to be too concerned with the direction of other indexes. This can be attributed to the fact that the problems in the financial sector doesn’t seem to be spilling over into Tech. The sub-prime/mortgage situation with the financials has little relation to the Technology sector. With the Bulls refusing to relent to the Bears, they are going to find a sector or industry somewhere that will keep making them money and right now its Tech.
