Medicare Agent News: Waiting for Powell

Wednesday, August 25, 2021

Waiting for Powell

By Jeffrey Cane | Wednesday, August 25

Waiting. Friday’s forecast for Jackson Hole, nestled by the majestic Teton mountains in western Wyoming, is sunny, with a high of 72 degrees. The forecast for Jackson Hole, the virtual Federal Reserve conference, is cloudy, with a chance of rain on the market’s parade.

That largely explains why today’s trading session was a sleepy one, as investors await Fed Chairman Jerome Powell’s speech, scheduled for 10 a.m. Eastern time on Friday. The speech will be studied for clues to the possible pace of a winding down of the central bank’s monthly buying of bonds and mortgage-backed securities. Goldman Sachs economists have increased the odds that the Fed will officially announce a tapering in November to 45% from a previous forecast of 25%, Reuters reported.

When there is little to drive it, the default direction of this current market is up, and that was the case today. The S&P 500 index edged up 0.2%, to its 51st record close of the year. Bank and financial stocks gained as Treasury yields climbed for a second day. The yield on the benchmark 10-year Treasury note rose to 1.342%, the highest it has been in two weeks. In addition to financials, energy and industrials were the strongest equity sectors. The Nasdaq Composite edged up 0.1%, to its 30th record close of 2021. The Dow Jones Industrial Average ended 0.1% higher as well.

Crude oil extended its recent rally, with near-month futures rising 1.2%, to $68.36 a barrel. Gold snapped a three-day winning streak, falling nearly 1%, to $1,788.20 an ounce today.

Speaking of streaks, it’s worth noting that the S&P 500 notched another unusual record today. Its recent winning streak, now at five sessions, is the second one of that length this month. In July, the S&P 500 also had two streaks of five or more sessions.

You would have to go all the way back to June and July of 1955 to find the last time that the index had two consecutive months of two separate streaks of five days or more, according to our colleagues at Dow Jones Markets Data.

And what happened later in 1955, you ask? (Other than the Brooklyn Dodgers winning their first World Series, of course.) Six months later, the index was down 3.7%. The following year, the S&P 500 sported a 12.2% gain.

A positive sign then? Wait'll next year.