Posts filed under “Federal Reserve”

Chart of the Week: Market Performance pre and post-Fed

Mike Panzner observes:   "Over the course of the current tightening cycle (comprised of 15 rate hikes beginning in June 2004), the median return for the S&P 500 on the day of an FOMC rate hike has been a loss of 0.09%,  while the median return for the day after has been a gain of 0.19%.

The best performing group on the day of a rate hike has been the Consumer Discretionary sector, with a median gain of 0.31%, while the worst performing group has been Information Technology, with a median loss of 0.23%.  On the day after the hike, the best performing group has been the Energy sector,  with a median gain of 0.73%, while the worst performing group has been the Industrials, with a median loss of 0.06%
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Market Performance pre + post-Fed

Fomcsectors_day_after

Source:  Mike Panzner

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Information Technology, Industrials, and Financials have been in the bottom four (out of 10) groups on both days, while the only sector that has been in the top four on both days is Consumer Staples.

One interesting observation: while the median return for the S&P 500 has been a small negative, only one group, Information Technology, has a median that is less than zero. Logically, that sounds wrong, but it may simply add weight to the anecdotal observation that FOMC rate days tend to be a little chaotic, with some sectors moving more sharply than others.

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Random Items:

Asia Is Getting Ready to Dump the Dollar Peg

Will The Markets and The WSJ Let Ben Be Ben? (pdf)

A Chill Is in the Air for Sellers

The Immigrant Economy

Fed ‘Pause’ Won’t Be End of Story       

Analyst Mary Meeker is back and looking awfully average

New Iraq strategy:  Muddle through until the end of 2008, then its someone else’s problem
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Quote of the Day

“I measure what’s going on, and I adapt to it. I try to get my ego out of the way. The market is smarter than I am so I bend." 
-Martin Zweig

Category: Federal Reserve

Rising Inflation is a Bigger Tax Bite than Oil

Category: Federal Reserve, Inflation, Markets, Technical Analysis

Berry to Bartiroma re: Bernanke: Big Burn, You Blew It

Category: Federal Reserve, Financial Press

Category: Economy, Federal Reserve, Inflation, Markets

Measuring Real-World Inflation versus Investing Returns

Category: Apprenticed Investor, Federal Reserve, Inflation, Investing, Markets, Psychology

One Two Three & Done (The Sucker Play)

Category: Federal Reserve, Fixed Income/Interest Rates, Psychology, Television, Trading

Ben Bernanke’s Inflation Targeting and Forecasting

Category: Commodities, Federal Reserve

Inflation Watch

Category: Commodities, Federal Reserve, Inflation

Pause/Resume Scenario Increasingly Likely

Category: Commodities, Economy, Federal Reserve, Inflation

“Every Change of Rate”

“Every Change of Rate” is an utterly hysterical parody of the black & white Police video “Every Breath You Take,” as done by some Columbia Biz School students; Its an amusing take on the Ben Bernanke, the newly appointed Fed Chief. My favorite bit are the lyrics during the second verse: “First you move your…Read More

Category: Federal Reserve, Music