The Fed did nothing because it just didn't feel like it. Rules don't apply at the Fed other than the gut rule, i.e. don't make your stomach hurt. So, no action. Hurray!
SP500 24.47, 1.15%
NASDAQ 55.85, 1.07%
DJ30 173.74, 0.96%
SP400 1.30%
RUTX 1.16%
SOX 1.49%
At the press conference Yellen did nothing to change the statement. Every FOMC meeting was 'live,' no one believes her, no rules apply, inflation speed limit at 2% means nothing because the core has been over 2% for 10 months. Most importantly, the Fed does not discuss any politics in its meetings. Of course it doesn't! Those have records kept. Thus any of those discussions would be outside official meetings. Oh well.
Of course stocks are surging on the free money train still running. The indices are testing the prior highs and indeed NASDAQ is moving to a new high. The other indices are pushing higher but we will see how they close.
Here is the issue: what is the day after? That is always the problem after FOMC decisions. This one appears guns are blazing. Again, it is over 2 months until the next real meeting (November is a week before the election--i guess if the Fed is really apolitical then it is 'live') so out of sight, out of mind.
SOX is back at the early September high. NASDAQ at a higher high. RUTX bouncing decently after its 50 day MA test. SP500, DJ30, SP400 also up, testing the 50 day MA's. Definitely a recovery this session and looking at some possible buys but knowing that the day after can see swings. This does look strong as noted.
Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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