Stocks closed sharply higher yesterday with the Dow soaring 3.57%, the Nasdaq gaining 2.95% and the S&P 500 up 2.53%. But the biggest moves came from the small-cap Russell 2000, which rallied 5.84% and the mid-cap S&P 400, which rallied 4.14%.

All of the major indexes made new all-time highs in the process, except for the Russell 2000, but they did make a new 3-year high.

The market cheered the conclusion of the long Presidential election. While the race for the White House and Senate have been called for the Republicans, the House of Representatives has not yet been called. But the trends do look like it could very well be a 'unified' government (i.e., the executive branch and both chambers of the legislative branch controlled by the same party).

With the election essentially behind us, the market will pivot to this afternoon's FOMC Announcement, where the Fed is widely expected to cut rates by another 25 basis points. In fact, the CME's FedWatch Tool shows Fed Funds traders giving it a 99.4% probability that's what the Fed will do this afternoon.

Given the high likelihood of the Fed's actions, the real unknown, which everybody is hoping to get a better understanding of, is what happens in December, and beyond? Will the Fed stick to their earlier forecast, following September's 50 basis point rate cut, with another 2 more cuts (25 bps in November and 25 bps in December), or will they trim that to just one? Moreover, what about 2025? They had previously forecast another 100 basis points of rate cuts next year, bringing the Fed Funds rate to a midpoint of 3.4%. Will they stick with that or will that change?

The FOMC Announcement comes out at 2:00 PM ET. That will be followed by the Fed Chair's customary Press Conference at 2:30.

In other news, yesterday's MBA Mortgage Applications showed the composite index down -10.8% w/w with purchases down -5.1% and refi's down -18.5%.

Today we'll get Weekly Jobless Claims, the Productivity and Costs report, Wholesale Inventories and Consumer Credit.

We'll also get more earnings.

After the close yesterday, we heard from AppLovin, which posted a positive EPS surprise of 31.6%, and a positive sales surprise of 6.01%. That translated to a quarterly EPS growth rate of 316% vs. this time last year, and a sales growth of 38.8%. They were up 2.07% in the regular session before earnings, and jumped another 27% in after-hours trade following earnings.

Today we'll hear from another 536 companies on deck to report with Duke Energy and Barrick Gold reporting before the open, while Airbnb and DraftKings go after the close, amongst others.

Momentum is on the market's side. And so are the seasonal trends, which show that Q4 is the best quarter of the year for stocks.

Combine that with it being a Presidential election year (year four of the 4-year Presidential cycle is the second-best year), it being earnings season (stocks typically go up during earnings season), and interest rates on the decline, and it looks like stocks are ready to end an already spectacular year on an even stronger note.

See you tomorrow,