The DC Today - Wednesday September 21, 2022
The Dividend Cafe
The Dividend Cafe - The Bahnsen Group
4.9 • 572 Ratings
🗓️ 21 September 2022
⏱️ 17 minutes
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Summary
I’d love to say “Fed comments caused the market to drop today” but it would be untrue. Within seconds of the Fed release the market went from +200 to -200, but then the market went back to +250, and that was all AFTER the Fed announcement, the release, and the Powell press conference. THEN, after all that, the market unraveled into the final thirty minutes of trading.
Dow: -522 points (-1.70%) S&P: (-1.71%) Nasdaq: (-1.79%) 10-Year Treasury Yield: 3.53% (-4 basis points) Top-performing sector: Consumer Staples (-0.34%) Bottom-performing sector: Consumer Discretionary (-2.37%) WTI Crude Oil: $83.04/barrel (+0.12%) Key Economic Point of the Day: Existing home sales dropped -0.4% in August and are down -19.9% from a year ago
Links mentioned in this episode: DividendCafe.com TheBahnsenGroup.com
Transcript
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| 0:00.0 | Welcome to the Dividing Cafe weekly market commentary focused on dividends in your portfolio and dividends in your understanding of economic life. |
| 0:10.0 | Hello and welcome to the Wednesday edition of the DC today, also known today as Fed Day. We got quite a roller coaster market, so I'll walk you guys |
| 0:25.4 | through everything that took place today. Quick summary items first, and then I'm going to |
| 0:30.3 | unpack with some commentary. The market was down. The Dow, 522 points. It's 1.7%. The S&P was down essentially the exact same. 1.71%. The NASDAQ, |
| 0:42.7 | real close as well, 1.79%. So very similar downside on all three of the major market indices. |
| 0:49.7 | The 10-year treasury yield closed at 3.53% that was down four basis points. |
| 0:57.4 | Consumer staples were the best performing sector. |
| 1:00.7 | They were down only 34 basis points. |
| 1:04.1 | So in a really violent down day, consumer staples were down 0.3%. |
| 1:08.2 | But then the worst performing sector was consumer discretionary, which was down |
| 1:13.6 | almost 2.5%. Oil was up a tiny bit at $83.4 cents a barrel. So effectively what happened today |
| 1:23.4 | is that the Dow had been up barely 100 points, 150 points, most of the day. |
| 1:31.8 | Then at 11 o'clock Pacific, 2 o'clock Eastern, the Fed came out and announced, as we all |
| 1:37.6 | knew was coming, a 0.75% increase in the Fed funds rate and their release that came with it had a few other, |
| 1:47.2 | you know, choices of language and kind of restatements or updating a past releases. |
| 1:53.1 | And almost immediately the Dow went from plus 200 to negative 200. |
| 1:58.7 | And so he had a 400 point swing in about 25 seconds. And I'm not |
| 2:04.7 | exaggerating. That's how quickly it moved. So it was with no new news, no unexpected news, |
| 2:11.6 | and in that kind of quickness, obviously the very quick unraveling of some quick trades around either hedges or |
| 2:21.8 | forward-looking calls or something that was more computerized and more technical and somewhat |
| 2:28.1 | irrelevant to the real world. But then this is the interesting part I want to unpack for you |
| 2:32.6 | guys. It then came all the way back and was back up 250 points. |
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