Markets Await Federal Reserve Decision

By September 14, 2015November 19th, 2015Weekly Market Observations (Archives)

By James Dondero | September 14, 2015

  • US stocks finally had a quiet week, ahead of one of the most widely anticipated FOMC meetings ever. While the broad market averages have bounced off their mini-meltdown lows, bottoming is typically a process rather than event and those lows may well see further testing in the days and weeks ahead.
  • Looking around the world, developed markets remain in far better shape than emerging markets. Specifically, both Japan and Germany have tested – and held – important area of support, while those in Russia and Brazil continue to trend lower.
  • Interest rates continue to remain within a wide trading range with credit spreads still leaning towards a “risk-off” environment. Weakness in credit led the recent volatility, making things like the HYG/TLT ratio good indicators to monitor going forward.
  • Finally, most commodities have put in short term bottoms and have been bouncing over the past few weeks. That being said, we continue to believe that at some point the US dollar will resume its advance, which should benefit stocks here in the US (watch Mark Okada’s CNBC’s commentary).

The views and opinions expressed are for informational purposes only and are subject to change at any time. This material is not a recommendation, offer or solicitation to buy or sell any securities or engage in any particular investment strategy and should not be considered specific legal, investment or tax advice. There is no guarantee that any of the forecasts will come to pass. Past performance is no guarantee of future results.