The market is trading higher in the early going here on Wednesday due mainly to positive responses to earnings from Alphabet (GOOGL) and Microsoft (MSFT) . Neither company had blowout reports, but market participants were relieved that there was not a major surprise, especially after the ugly news from Walmart (WMT) on Tuesday.<\/p>\n
In addition to mild positive responses to Alphabet and Microsoft, there were good reports from Chipotle Mexican Grill (CMG) and Texas Instruments (TXN) , but the market doesn't look quite ready to start chasing the news at this point.<\/p>\n
The big event will be the Fed interest rate announcement at 2 p.m. ET, followed by a press conference with Fed Chairman Jerome Powell. It is widely expected that the Fed will raise rates by three-quarters of a percentage point for the second month in a row, but what will be key is the policy statement and any hints about the pace of future hikes.<\/p>\n
The Fed has been far more concerned about taming inflation than it has been worried about creating a recession, but now that there is some clear economic slowing in places the issue is whether there will be any hints about a gradual pivot to a less hawkish posture.<\/p>\n
Investors are not very optimistic about a market-friendly Fed at this point, but those low expectations mean that even a subtle hint about some shift in policy will likely create a positive market response.<\/p>\n
As the Fed news is digested, there will be a slew of earnings reports as well. Companies such as Meta Platforms (META) and Ford Motor (F) report tonight, and Apple (AAPL) is on deck for Thursday.<\/p>\n
Overall the news flow out there is not very positive, but expectations are low and that is helping to create a positive reaction. If we had this sort of news in a different market environment there would be substantial selling pressure, but this market has discounted quite a bit of bad news already so mediocre news is all it takes to create a positive response.<\/p>\n
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The Power of Low Expectations Is on Display in Reaction to Tech Giants' Results - RealMoney<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" The market is trading higher in the early going here on Wednesday due mainly to positive responses to earnings from Alphabet (GOOGL) and Microsoft (MSFT) . Continue reading