Well it appears U.S. stocks are spending Monday in full-on wishy-washy mode- as investors can’t decide whether they want fries with last week's optimism or not. 

(Source: Giphy) 

So far, the S&P 500 has slipped 0.3%, landing just shy of its July record high—so close, yet so far. Meanwhile, the Dow Jones strutted around like it owned the place, adding 92 points, or 0.2%, to hit a new record. But the Nasdaq? Yeah, it’s definitely not having a day as it’s dipped -1%; mostly dragged down by tech stocks that finally decided they’d had enough fun for the year.

(Source: Investopedia) 

So why all the wobbling you ask? It all comes down to the Fed, obvi. Investors are on edge ahead of the two-day policy meeting that kicks off tomorrow. Now, the market’s pretty sure the Fed is about to cut rates—something we haven’t seen since 2020—and the current betting odds are about 63% for a 0.5% slice. But, of course, nothing in this world is guaranteed, especially when it comes to central bankers and their cryptic decisions.

(Source: Giphy) 

Speaking of tech stocks, Apple is completely whiffing today, falling 3.2% after analysts pointed out that their latest iPhone isn’t exactly flying off the shelves. Which isn’t necessarily surprising considering Apple's new updates aren’t quite the catalyst to get people camping outside to buy another edition of the world's most expensive rectangle. But with that said, its not just Apple taking a beating.

(Source: The Street) 

Semiconductors and the whole tech sector collectively decided to take the day off, dragging the S&P 500 down in the process as Nvidia and Microsoft are down -2.44% and -0.18%, respectively.

(Source: Yahoo Finance)

The reason for the dip, according to Christopher Barto, senior investment analyst at Fort Pitt Capital Group, is that traders are cashing in on Big Tech’s gains. After all, you can only ride a winner for so long before you feel the need to take your chips off the table. Meaning with tech cooling off, financials and energy are starting to look like the hot new thing ahead of the Fed’s rate cut.

Which is why it's not too shocking to see financials and energy stocks popping +0.9% on the day. You see, if the Fed really does cut rates, these sectors are about to make it rain. Higher borrowing costs have been rough on them for the last year, but with the Fed possibly cutting rates, it’s like they just got the green light to start printing money again.

(Source: Giphy) 

So clearly, today’s trading is more about killing time than making any real moves - whereas, we are all standing on the edge of a cliff, just waiting for Grandpa Powell to give us a little push. 

On the one hand, a rate cut could give the economy a little kick in the pants. On the other, the Fed could pretty much put the nail in the coffin of utter disaster ahead. And that’s the kind of news that makes corporate earnings want to crawl under a rock and hide.

(Source: Giphy) 

So while the market had a nice winning streak last week, the S&P 500 is treading water, waiting for the Fed to show its hand. Inflation’s cooling, the job market’s holding steady, and everyone’s just sitting around, wondering what happens next. 

Jack Janasiewicz, lead portfolio strategist at Natixis Investment Managers Solutions (because apparently, the longer your title, the more important your opinion), summed it up by saying, “The market clearly expects the Fed to cut rates now. How stocks react once the central bank moves will depend on what message they send about future policy moves. If markets think the Fed is done, that will be regarded as negative.” In other words, if the Fed says, “This is it for rate cuts,” the market might throw a little tantrum.

(Source: Market Watch) 

Meanwhile, in the land of Trump (because no financial news day is complete without a mention of the former president), Trump Media & Technology Group had a rough Monday, with shares dropping 2.9%. 

(Source: Barrons) 

Why? Oh, just the small matter of Trump reportedly being the target of a second assassination attempt in less than two months. You know, typical Monday stuff. This comes after Trump’s stock rallied on Friday when he reassured investors that he wasn’t planning to sell his 59% stake in the company anytime soon, even though a lockup period is about to expire. Classic Trump— the guy is always keeping things interesting.

Over in the corporate world, Boeing shares took a 1.9% hit after its biggest union decided to go on strike, all while Intel became the markets golden child (legit shocker), gaining 4.2% after news broke that it could qualify for up to $3.5 billion in federal grants to fund semiconductor production. 

(Source: Bloomberg) 

Oh and just when you thought bonds were boring, the yield on the 10-year U.S. Treasury note edged up to 3.545%, from 3.531% on Friday. What does that mean for stocks? Well, higher yields make borrowing more expensive and future stock returns less attractive. So yeah, it’s not exactly great news if you’re holding a bunch of equities.

(Source: CNBC) 

So what’s the takeaway here, friends? Well simply put, the market’s in full holding pattern mode right now. All eyes are on the Fed, and until they make their move, expect more of this back-and-forth action throughout the day. 

But, but, but…

With that said, who cares about the rest of the market when there is a seismic 61% SHORT-INTEREST in Dark Pool data (aka the smart money OF the smart money) on our alert for today! 

(Source: Giphy) 

Meaning, today’s little known stock is primed for a massive SQUEEEEZE at any moment!

Keep in mind, we’ve already seen a seismic 96% move from the stock last week… could we see triple the move this week? Click here for the details and find out…

In the meantime, stay safe and stay frosty, friends! Until next time…

Stocks.News holds positions in Apple, Microsoft, and Intel as mentioned in the article.