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Late Equity Roundup: Hawkish Guidance, Late Session Volatility


Late session volatility - stock indexes were firmer after experiencing some post-FOMC swings: Hawkish forward guidance weighed on equities (initial selling sent SPX to 3836.75 low) and helped push 2YY to new 15 year highs of 4.1168%, yield curves extending inversion (2s10s -52.492 low).

  • But flipside to hiking to is prospect of cutting rates as price stability and inflation comes back to 2.0% target helping current rebound with SPX tapping 3918.75 high. Round of selling on late question regarding economic pain and potential "difficult correction" to get housing fundamentals back in balance.
  • Currently, SPX eminis trades -23.75 (-0.61%) at 3850.25; DJIA -210.28 (-0.68%) at 30509.19; Nasdaq -52 (-0.5%) at 11378.06.
  • SPX leading/lagging sectors: Consumer Staples lead for the second day running (+0.79%) lead by food, beverage and tobacco shares, followed by Information Technology (+0.36%) while Industrials (+0.17%) scaled back earlier gains. Laggers: Consumer Services (-0.47%) weighed by telecom shares, followed by Materials (-0.38%) and Consumer Discretionary (-0.23%) with services underperforming.
  • Dow Industrials Leaders/Laggers: Rebounding after heavy pressure Tue, Home Depot (HD) +3.37 to 277.54, Walmart (WMT) +3.08 at 136.63, Goldman Sachs (GS) +3.02 at 326.18. Laggers: United Health (UNH) -2.95 at 519.85, Caterpillar (CAT) -2.68 at 175.3, Visa (V) -2.57 at 189.5.

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