It should not surprise anyone that the Fed kept rates at zero today, given where the economy sits. But that, along with continued better than expected earnings hep push markets higher on the day, as we await the flood of FAANG earnings tomorrow. The companies reporting tomorrow represent 40% of the market cap of the whole Nasdaq; that’s huge!
Small caps led the day, followed by emerging markets. Tech stocks and European equities lagged the most. The majority of equity factors finished fairly muted, save for the Small Cap factor.
Given the Fed’s continued dovish stance, it is no surprise that most fixed income products had positive days; led by lower quality credit products.
As mentioned a few times this week, tomorrow Royal Dutch Shell, Amazon, Apple, Google, Ford, UPS, and a whole bunch of other major names report tomorrow. Given the portion of the stock market that these companies represent, tomorrow’s earnings reports could have a major impact on the markets as they will let investors know how the biggest and richest companies out there are faring during COVID.
Tomorrow also brings the excitement of major economic releases, primarily GDP, Initial and Continuing Jobless Claims. While it’s reasonable to assume that the jobless numbers will come in marginally in line with expectations, the GDP numbers could be a big unknown.
It’s safe to say that tomorrows releases, both corporate and economic, could significantly shape the coming weeks in the markets; so hold on to your hats, tomorrow should be fun!
Nathan