Daily Markets: Markets Absorbing Fed Comments

Man wearing face mask in front of stock market board
Credit: Aly Song - Reuters /

Today’s Big Picture

Asia-Pacific equity markets finished the day lower following yesterday’s Fed meeting and comments. China’s Shanghai Composite declined 0.77%, India’s SENSEX fell 0.85%, both Australia’s ASX All Ordinaries and Hong Kong’s Hang Seng gave back 1.29% while Taiwan’s TAIEX shed 1.32%, and Japan’s Nikkei was off 1.37%. South Korea’s KOSPI closed 1.75% lower in a broad decline led by Electronic Technology names. Major European markets are down at least 1% across the board in midday trading and U.S. equity futures point to a lower open.

What a difference a day can make. Almost immediately following Fed Chairman Powell’s press conference, traders reset the Fed funds futures curve, pushing out the anticipated timing of the first rate cut a full quarter to the end of Q3 2024. While markets expected a no-action result, Chairman Powell’s comments and responses to questions confirmed that he and the Fed remain hawkish in his stance and that determination, coupled with his assertion that there essentially has not been enough pain yet to point inflation toward the 2% target, soured the mood for traders. Oftentimes, the market will react strongly to events as they happen but given a night, soften their stance. However, given the Asia-Pacific overnight market reaction, today’s lower European markets and U.S. equity futures decidedly lower, it looks like markets may need a little more time to adjust to this new reality.

Data Download

International Economy

Following yesterday’s U.S. Federal Reserve meeting and decision to hold rates steady, the Bank of England (BoE) will announce its own decision on rates. Expectations are of the bank to announce a 25 basis point (0.25%) increase which would set rates at 5.50%. Despite both top line and core CPI being north of 6%, Goldman Sachs (GS) recently revised its terminal rate outlook for the UK to 5.50% from the previous 5.75% guidance, indicating that at least one research firm sees some light at the end of the inflation tunnel.

Domestic Economy

Today see updates on the Jobs front as Continuing Unemployment Claims as of September 6th are expected to rise slightly to 1.692 million from the previously reported 1.688 million and Initial Claims are expected to gain 5,000 to sit at 225,000 for the weekly period ending September 16.

August Existing Home Sales will also be reported and is expected to pick up 30,00 units over the July number to hit a seasonally adjusted annual rate of 4.1 million.


As mentioned above, traders were not happy with the message coming out of yesterday’s Fed rate meeting. Consumer Discretionary (-1.00%), Materials (-1.05%), Communication Services (-1.36%), and Technology (-1.57%), representing 50% of the weight of the S&P 500 were down at least 1%. Safety was found in classically defensive sectors like Utilities (0.09%), Consumer Staples (0.10%), and Real Estate (0.19%) while Healthcare ended the day flat, eking out a 0.01% gain. The Dow declined 0.22%, the Russell 2000 fell 0.90%, the S&P 500 shed 0.94% and the Nasdaq Composite closed 1.53% lower. One place traders sought refuge was in shares of AutoZone (AZO) which gained 4.37% after several analyst firms raised price targets and reaffirmed “Buy” and “Overweight” ratings following the company’s positive earnings call on Wednesday.

Here’s how the major market indicators stack up year-to-date:

  • Dow Jones Industrial Average: 3.90%
  • S&P 500: 14.66%
  • Nasdaq Composite: 28.69%
  • Russell 2000: 2.77%
  • Bitcoin (BTC-USD): 63.60%
  • Ether (ETH-USD): 35.46%

Stocks to Watch

Before U.S. equity markets begin trading today, Darden Restaurants (DRI) and FactSet (FDS) will report their quarterly results.

While not much is positive in pre-market action this morning, shares of Marvell Technology (MRVL) are up 3.74% on news that Alphabet has been considering switching chip providers from Broadcom (AVGO) to Marvell.

FedEx (FDX) reported quarterly revenues of $21.7 billion, slightly under consensus estimates of $21.8 billion, and fully diluted EPS of $4.23 as compared to estimates of $3.75. The company cited expense savings of $1.8 billion due to the DRIVE Transformation Program. 2024 guidance predicts flat revenue as compared to 2023. FedEx CEO Raj Subramanian commented the company “started fiscal 2024 with strong momentum as our global transformation actions take hold and drive improved results” and added that “FedEx is positioned to continue to deliver improved profitability” going forward.

KB Home (KBH) posted quarterly net income of $149.9 million, or $1.80 a share down from $255.3 million, or $2.86 a share, in 2022. Analysts expected earnings of $1.43 a share. Revenue declined to $1.59 billion from $1.84 billion as compared to expectations of $1.47 billion. Homes delivered fell 7% to 3,375. Net orders for the third quarter grew 52% to 3,097 and net order value rose 54% to $1.51 billion. KB Home said the increases reflected improved demand and lower cancellation rates compared to a year earlier given the combination of factors including ongoing inflation and rapidly rising mortgage interest rates.


There are no IPOs scheduled to price today. Readers looking to dig deeper into the upcoming IPO calendar should visit Nasdaq’s Latest & Upcoming IPOs page.

After Today’s Market Close

Manchester United (MANU) and Rite Aid (RAD) are slated to report quarterly results after equities stop trading. Those looking for more on upcoming quarterly earnings reports should head on over to Nasdaq’s Earnings Calendar.

On the Horizon

Friday, September 22

  • Japan: Inflation Rate – August
  • Japan: Jibun Bank Flash Manufacturing and Services PMIs - September
  • UK: Retail Sales – August
  • Eurozone: HCOB Flash Manufacturing and Services PMIs - September
  • UK: S&P Global/CHIPS Flash Manufacturing and Services PMIs - September

Thought for the Day

“My brother thinks he’s a chicken. We don’t talk him out of it because we need the eggs” ~ Groucho Marx


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Chris Versace

Christopher (Chris) Versace is the Chief Investment Officer and thematic strategist at Tematica Research. The proprietary thematic investing framework that he’s developed over the last decade leverages changing economic, demographic, psychographic and technology landscapes to identify pronounced, multi-year structural changes. This framework sits at the heart of Tematica’s investment themes and indices and builds on his more than 25 years analyzing industries, companies and their business models as well as financial statements. Versace is the co-author of “Cocktail Investing: Distilling Everyday Noise into Clear Investing Signals” and hosts the Thematic Signals podcast. He is also an Assistant Professor at NJCU School of Business, where he developed the NJCU New Jersey 50 Index.

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Mark Abssy

Mark Abssy is Head of Indexing at Tematica Research focused on index and Exchange Traded Product development. He has product development and management experience with Indexes, ETFs, ETNs, Mutual Funds and listed derivatives. In his 25 year career he has held product development and management positions at NYSE|ICE, ISE ETF Ventures, Morgan Stanley, Fidelity Investments and Loomis Sayles. He received a BSBA from Northeastern University with a focus in Finance and International Business.

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