Major averages shot higher Friday morning before giving back some of their gains on higher, triple witching options-expiration volume. The S&P 500 came up near to its 50-day moving average before heading back down as it stalled on lighter volume.
A number of Fed members have spoken including:
- Eric Rosengren who said the U.S. is “on the verge” of meriting a June interest-rate
hike.
- John Williams who recently reiterated his prior view that two to three rate hikes could be appropriate in 2016 with three to four being possible in 2017.
- James Bullard, who questioned market expectations for future hikes. Bullard also voiced his confidence in recent employment figures, stating that the U.S. labor market is "at or beyond full employment."
Despite the hawkish commentary, the UK Brexit vote takes place about a week after the June Fed meeting, so it's unlikely the Fed will raise rates at that meeting. Fed futures put the odds at 26%.
Weekend updates on both the short and long side of individual stocks were sent out to members this weekend. Members should be prepared to move with the market in either direction as the indexes sit at near-term support. A strong move back up through their 50-day moving averages by the S&P 500 and the NASDAQ Composite could signal the
start of a new upside move, while a significant breach of support would indicate that downside risk is increasing.
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