3 months ago
Stock Market

Day Ahead: Top 3 Things to Watch

Investing.com - Here’s a preview of the top 3 things that could rock markets tomorrow. 1. Fed Day Part 2: The

Investing.com - Here’s a preview of the top 3 things that could rock markets tomorrow.

1. Fed Day Part 2: The Overanalyzing

Expect plenty of Monday (Thursday) morning quarterbacking following today’s Federal Reserve rate hike.

At its face it appears that the market got what it expected (another boost of 25 basis points) and what it wanted (signs from the dot plot the Fed won’t be as aggressive next year).

But, as often happens, the market decided what it wants isn’t what it wanted in the first place. Investors were apparently hoping for much more dovish projections for 2019 and more dovish comments from Fed chief Jay Powell at his Q&A.

The Dow swung from up 300 points shortly before the decision to close down about 350.

Traders will be looking closely at the Treasury yield curve tomorrow for more signs of flattening, with many saying that the Fed’s decision to keep its policy of quantitative tightening (QT) by $50 billion per month on autopilot spooked equity investors.

The spread between the 10-Year and 2-Year yields was 11 basis points at the time of writing.

And for those burned out on the Fed, hey, the chances it keeps rates steady next month are currently 100%.

2. Philly Fed and Jobless Claims Arrive

While the Fed is (somewhat) in the rearview mirror, the economic numbers keep rolling in.

At 8:30 AM ET (13:30 GMT), there will be the figures on weekly jobless claims.

Economists expect that claims for first time unemployment benefits rose to 219,000 last week.

At the same time the Philadelphia Fed will release its measure of December manufacturing activity, with economists forecasting the Philly Fed index to climb to 15.6.

3. Walgreen’s Set to Report

Dow component Walgreens Boots Alliance (NASDAQ:WBA) reports earnings before the bell tomorrow.

On average, analysts expect the drugstore chain to report a profit of $1.43 per share on sales of about $33.8 billion.

Shares looked to be on a roll in late November when there was speculation of a deal with Humana (NYSE:HUM) that sparked a rally, but the stock joined the rest of the market in the recent selloff and is little changed in the last three months and the year.

Investors will be looking for details on its partnerships with companies like Kroger (NYSE:KR) and Alibaba (NYSE:BABA), according to Briefing.com.