Stocks Fade Late On Hawkish Fed Tone; LULU, COST, CRWD In Focus | Stock Market Today

TL;DR

The Fed's rate hike notes and expectation of another rate hike before the end of the year have caused the market to react negatively, with the NASDAQ down 1.5% and the S&P 500 down 0.9%.

Transcript

thank you foreign good afternoon everyone and welcome to stock market today it's Ali Corman kendrief here with the breakdown of the action in today's session Wednesday September 20th with a poor reaction to the Fed rate hike noteskin with the FED signaling it's not done hiking those rates it's not done uh we got another look at the Dot Plot which i... Read More

Key Insights

• ☠️ The Fed's rate hike notes have sparked concerns about higher interest rates and their impact on economic growth and stock valuations.
• 🥳 The market is experiencing distribution, with several distribution days indicating a weakening trend.
• 💩 Growth stocks, including leaders like Elf Beauty and Celsius, have been hit hard by the sell-off.
• 🏆 The NASDAQ is at risk of testing the 13,000 level due to increased distribution and negative price action.
• 🥳 The S&P 500 avoided a distribution day but still faced selling pressure, with leaders showing weakness.
• 🫰 The Russell 2000 is the weakest index, with an imminent test of the 1,800 level.
• 👋 Lululemon and Costco have shown relative strength in the retail sector, with good earnings and growth prospects.

Questions & Answers

Q: Why did the market react negatively to the Fed's rate hike notes?

The market reacted negatively because the Fed's rate hike notes indicate expectations of higher interest rates, leading to concerns about the impact on economic growth and stock valuations.

Q: What is the Dot Plot and what did it show?

The Dot Plot is a visual representation of individual committee members' projections for interest rates. It showed that the Fed expects one more rate hike before the end of the year and a higher Fed funds rate in 2022 than previously anticipated.

Q: How has the market's reaction affected major indexes?

The NASDAQ was down 1.5%, the S&P 500 was down 0.9%, and the Russell 2000 was down 0.7%, indicating a decline in the overall market.

Q: Why are growth stocks experiencing selling pressure?

Growth stocks are experiencing selling pressure due to the market's reaction to the Fed's rate hike notes and concerns about high valuations. Investors are rotating into other sectors perceived as safer in a higher interest rate environment.

Summary & Key Takeaways

• The Fed's Dot Plot shows expectations of higher interest rates, indicating that rates could stay higher for longer due to a strong labor market and resilient economy.

• The market's reaction to the Fed's rate hike notes has led to a decline in major indexes, with the NASDAQ down 1.5%, the S&P 500 down 0.9%, and the Russell 2000 down 0.7%.

• The market is experiencing distribution, with several distribution days and weakness in growth stocks.