Stock market

Stock market update Wednesday 31st July 2019

Closing positions of: FTSE 100, S&P 500, DOW, DAX, NASDAQ, NIKKEI & GOLD

I trade these indices on a regular basis

FTSE 100 – closed at: 7586 (down)

DAX – closed at: 12189 (up)

DOW – closed at: 26864 (down)

S&P 500 – closed at: 2980 (down)

NASDAQ – closed at: 8175 (down)

NIKKEI – closed at: 21521 (up)

GOLD – closed at around: $1,416 (down)

Note

Fed rate cut announced

The FOMC concluded its two day meeting with a 0.25% interest rate cut, pretty much as expected. The Fed chair spoke of inflationary pressures and implications of global developments.

The rate cut is seen as more of an insurance policy, not against what’s wrong with the economy now, but what could go wrong in the future.

Trump tweets his disdain with the Fed’s decision.

Fed said

The Federal Reserve also left the door open for future cuts, saying it will, ‘act as appropriate to sustain the expansion’, as it continues to evaluate the incoming data.

The Fed also said, ‘it was part of an ongoing move to adjust to economic conditions though no guarantee of future cuts’. Fed Chairman Powell also said the rate move was a ‘midcycle adjustment,’ possibly hinting more cuts are not a guarantee.

Take from these points what you will. Door left ajar?

Dow falls

Markets took Fed chair Jerome Powell’s comments to be less dovish, prompting a sell-off on Wall Street. The Dow briefly dropped by around 470 points.

The Dow closed down at: 26864 – with futures falling further.

This is the first U.S. rate cut since December 2008 – since the financial crisis came to visit, eleven years ago.

Federal Reserve issues FOMC statement can be found here.

Leave a Reply

Your email address will not be published. Required fields are marked *