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Fed Set To Raise Rates, Market Poised To Move Higher

Much better day in the markets yesterday with all of the major indexes in the green.

Facebook suffered another -2.50% decline. And some other social media stocks declined as well. But as I remarked yesterday, FB's problems are largely just that -- FB's problems. It might spill over a bit into other social media companies as data mining risks are assessed. But it's unlikely to have any real negative effect on the broader tech space because what happened to them was, once again, a uniquely FB problem.

But attention will shift to more important news today, which is the FOMC Meeting Announcement, where the Fed is expected to raise rates by a quarter point.

In addition to the expected rate rise, traders will be watching the FOMC Forecast where they'll give their assessment on the economy and all that entails, along with hints as to the timing of their next move on interest rates.

And lastly, but surely not least, the market will be watching the language they use in these reports to see how it deviates from their prior language. And we'll all be listening to the Fed Chair's Press Conference. This one will take on extra importance given this will be the new Fed Chairman's (Jerome Powell), first Press Conference after replacing Janet Yellen earlier this year.

Assuming there are no surprises, I believe this will have a longer-term bullish effect on the market as it should show the Fed's confidence in the economy, but at the same time confirm that they will take a slow and measured pace when raising rates.

Expecting to put this correction/consolidation behind us shortly thereafter and begin a whole new leg higher.

See you tomorrow,

Kevin Matras

Executive Vice President, Zacks Investment Research

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