Markets

Fed, Trump And More

In any normal trading week, the big news we'd all be expecting is the announcement from Fed Chair Janet Yellen Wednesday on whether or not the Federal Reserve will be raising interest rates for the first time this year. In any normal week, analysts and pundits would be putting together talking points on what to expect from the incoming President-elect on January 20th of next year.

But this is not any normal week, nor is it a normal year. After holding off of raising rates 25 basis points at least two other times in 2016, this time it's baked into the cake: the rate-hike is coming. With a roaring stock market hitting new highs and an unemployment rate plummeting to 4.6%, the Fed can finally claim victory in its plan to keep rates accommodative until inflation can be seen creeping into the economy.

This is before discussing that President-elect Trump is keeping anything but silent following his surprise election victory but with six weeks before he's sworn into office. Trump is not only telegraphing what he intends to focus on once President, he's sending out tweets on a regular basis. In fact, he's likely the single-most important habitual user of Twitter TWTR anyone has ever seen. Already.

Following Trump's indication he is tapping ExxonMobile XOM CEO Rex Tillerson for U.S. Secretary of State - another non-politician who will presumably run he government "like a business" - the President-elect took to the twittersphere just this morning to bash the expense of the F-35 fighter plane, whose costs are "out of control," made by Lockheed Martin LMT . So in his usual head-snapping way, Trump has put forth a new course for U.S. activity to be presumably Big Oil while at the same time relatively down on Big Defense.

Oh, and Lockheed shares are down 2.5% in the pre-market in the wake of Trump's latest tweet.

Later this week, Trump meets with chief executives of Apple AAPL , Microsoft MSFT , Oracle ORCL and others to discuss Big Tech policy going forward. If his recent comments are any indication, expect the President-elect not to mince words. Whether or not he tweets the results of the meeting will apparently be up to his discretion, as always.

Market futures ahead of the bell are mixed. With many analysts openly looking forward to the Dow hitting an unprecedented 20,000, the S&P 500 and Nasdaq are pulling back slightly from Friday's close. We expect oil stocks to bid up as the actualization of a Tillerson role is absorbed by the market. Otherwise, count Yellen's rate hike as the only real certainty this week.

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


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

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