European stocks slipped from an 11 month high, Asian stocks and S&P futures were flat as caution pervades global markets before the Federal Reserve’s expected interest-rate hike on Wednesday. Crude dropped to session lows near $52 after API data showed U. S. stockpiles increased, and after a Manaar Group consultant said Iraq won’t cut output by 180k b/d-220k b/d as it committed to do under Nov. 30 OPEC agreement.
Top corporate news stories include Johnson & Johnson ending Actelion pursuit, IBM vowing to add 25,000 jobs, Hertz replacing its CEO, the WSJ reporting that Goldman is planning to appoint Harvey Schwartz and David Solomon to succeed President Gary Cohn.
“Markets are very much on hold ahead of the Fed,’ said Marc Ostwald, strategist at ADM Investor Services International in London told Bloomberg. ‘The Treasury rally is also helping to pull yields elsewhere lower, along with a slip in oil prices and a softer tone to equities. Changes to the Fed dot plot and economic forecasts will be key to watch.’
Today’s FOMC decision has been overshadowed by some big events over recent weeks. As DB’s Jim Reid writes in his overnight piece, today’s outcome has barely registered on people’s radar as a potential macro event. Consensus is the expected 25bp hike but with a wait and see approach from Yellen where she’ll reiterate that it’s too early to second guess potential upcoming fiscal changes. A December rate hike is now fully priced in by the market.
This post was published at Zero Hedge on Dec 14, 2016.
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