🎯Gone in a flash, Return like a shadow🎲

Equity markets cheered on the latest CPI figure, which is well below expectations. This gives the Fed less impetus to progress with aggressive rate hikes. It thus supports risk asset prices. Still, as the trading continues, much of the gain is evaporated as major indices attempt to close the gaps. 

Pika World took some hits as markets dribbled back down to protect our capital. Conversely, we sold most of our Russell holdings as we moved into the FOMC meeting decision. Since the market already had a firm run on the back of lower expectations, the resistance of the S&P 500 is becoming harder to break. We have seen how sellers have swarmed in at the 4100 level several times during the year, and yesterday was no different. 

Recall that in October, when the CPI result was released, the indexes swung up and down before moving up again. 

🧮Bond market yield eased with latest data🧸

We also see movement in the bond market. The two-year Treasury yield, which is often seen as a barometer of where the federal funds rate will land, had fallen to 4.229% from over 4.37% a moment before the release of the CPI data. 

As the dollar weakens, the lower yield also discourages investors from holding more dollars, and we are also seeing the weakening of the US Dollar index. This bodes well for companies that derive much revenue from overseas sales. However, it now pins on how far the Fed will raise rates. 

🎢Moderna: Cancer vaccine gaining traction💰

The stock price rose sharply after the company’s RNA-based cancer vaccine’s experimental messengers helped moderate the risk of death and recurrence during a Phase 2 cancer trial. This is good progress, and investors are pumping on the new growth prospect. 

📮What’s on the menu today?💰

At 3 am, we will have the Fed Interest rate decision, followed by 3.30 am on Uncle Powell’s press conference. It is a roller coaster period for the market with back-to-back important data. 

It is 14 December, Wednesday, at 9 am in Singapore and 8 pm in New York. While it has been a challenging trading week, we hope all friends have a moonatic day ahead!