Day Traders Diary

9/19/23

The major averages sold off sharply only to recover into the close as we head into the Federal Reserve policy meeting tomorrow. The Dow Jones Industrial Average lost 106 points after falling over 300 points. The S&P 500 declined 9 points while the Nasdaq Composite fell 32 points.

The central bank's two-day meeting began today. The Fed is not expected to raise rates when announcing its decision Wednesday, with traders pricing in a 99% probability that the central bank skips a hike, according to CME Group's FedWatch tool, a gauge of pricing in fed funds futures. Traders are putting just a 29% chance of a hike in November.

The Fed could create some volatility with their market forecasts on Wednesday. Investors will watch for commentary around the path of inflation and future path of interest rates.

On the corporate news front, Starbucks was lower facing a consumer lawsuit and a downgrade from TD Cowen. CVS Health and Dell were higher on upgrades.

Disney led the Dow lower down 3% after announcing plans to nearly double its investment in its cruise and parks business. Deere fell 3% on a downgrade from Evercore.