Wake Up Wall Street (SPY) (QQQ): Fed hikes, BOJ intervenes and equities look lower


Here is what you need to know on Thursday, September 22:

Wow, things are getting busy around here. It is central bank week, and so far it is hikes as far as the eye can see. First up, the Fed duly raised rates by 75 basis points last night and surprised markets with the dot plot of future rates. This shows no cuts in 2023 and perhaps a modest increase. This was at least 50bps higher than interest rate markets had been predicting and led to an immediate crash in risk assets. However, once the press conference Q&A began equities took some hope from more restrained talk before selling off again into the close.

Next up the Bank of Japan did nothing on the interest rate front but did intervene to halt the inexorable rise in the dollar. This is likely to only provide some short-term relief as no other central banks are on board. The Bank of England went all lovey-dovey in going for 50bps as the hoped-for energy price cap will put a lid on inflation. The Swiss National Bank also went for a 75 basis point hike. 

Where equities trade from here is likely lower, but in the short term we may get a positioning rally as everyone was a tad bearish. Overall, things are getting harder and harder for equity valuations as TINA is dead now with rates heading for 5%. Bitcoin though is 3% higher this morning, reinforcing our short-term bounce thesis. I mean very short term like the rest of this week! Attention will now begin to look ahead toward third quarter earnings. Since last time out the dollar has continued higher and economic conditions have worsened, so this is likely to be a challenging season.

Oil is higher at $85, and Bitcoin is at $19,200, up 4% now. Gold is trading at $1,681, while the dollar index is lower at 110.68. 

See forex today

European markets are mixed: Eurostoxx +1%, FTSE +0.6% and DAx -0.6%.

US futures are higher: S&P flat, Dow +0.1% and Nasdaq is flat.

Wall Street Top news (SPY) (QQQ)

Fed hikes rates 75 bps and sees higher rates for longer.

Bank of Japan intervenes in FX market to support Yen, selling dollars.

Bank of England hikes rates 50bps.

Swiss National Bank hikes rates 50 bps.

Royal Caribbean (RCL) announces note offering.

Target (TGT) to hire 100k workers for the holiday season, same as 2021.

Costco (COST) earnings after the close.

Darden Restaurants (DRI) revenue misses but restates guidance.

American Tower (AMT) increases dividend to $1.47 per share.

Ideanomics (IDEX) files for a secondary offering.

LiAuto (LI) to host an early launch event for L8 premium car on September 30.

Tilray (TLRY) gets Italian approval for distrubution of THC25.

Accenture (ACN): EPS beats, revenue in line.

Honda Motors to reduce car output by 40% at two Japanese plants by up to 40% in October due to supply chain issues-Reuters.

Toyota plans to produce 100k less vehicles in October due to semiconductor chip shortages. Reuters.

Salesforce (CRM) announced plans to operate more efficiently.

Eli Lilly (LLY): FDA approves Retevmo for new uses.


Upgrades and downgrades

source: WSJ.com

Economic releases

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content

Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content

Editors’ Picks

EUR/USD keeps range near 1.0650 ahead of German IFO survey

EUR/USD keeps range near 1.0650 ahead of German IFO survey

EUR/USD is keeping its range play intact near 1.0650 in the early European hours on Monday. Markets stay risk-averse, weighing the Fed's 'higher-for-longer' rate view and lingering China's property market woes. Germany's IFO survey eyed. 


GBP/USD remains on the defensive below the 1.2250

GBP/USD remains on the defensive below the 1.2250

GBP/USD remains on the defensive below the mid-1.2200s early Monday. The US Dollar is clinging to the previous week's gains alongside firmer US Treasury bond yields while the Pound Sterling weighs the Fed-BoE policy divergence amid a quiet calendar. 


Gold remains stuck below key averages, what’s next?

Gold remains stuck below key averages, what’s next?

Gold price is easing toward $1,920, making it for a negative start to a key week ahead. The United States Dollar (USD) and the US Treasury bond yields have entered a phase of consolidation near last week’s high, as investors look to this week’s inflation data from the US and Europe for a fresh directional impetus.

Gold News

Ethereum whales prepare ahead of futures Ethereum ETF approval on October 2

Ethereum whales prepare ahead of futures Ethereum ETF approval on October 2

Ethereum price is likely going to witness a massive spike in volatility soon due to the circumstances surrounding the approval of the token’s futures Exchange-Traded Fund (ETF). According to Twitter users, the ETF is likely going to be approved on October 2.

Read more

Is inflation falling further?

Is inflation falling further?

A first flash estimate of Eurozone inflation in September is expected. In August, inflation fell slightly to 5.2%. While the downward pressure from energy prices has eased slightly, the momentum of food prices has continued to decline.

Read more