MarketBites: Fed Raises Rates, Are We In A Recession?
Portfolio Manager Commentary:
Stocks fell on Tuesday as weaker economic data and Walmart's profit warning added to recession concerns.
Stocks surged on Wednesday, led by technology stocks. The move comes after the Federal Reserve pleased everyone by raising interest rates by the expected 0.75%. Fed Chair Powell, pointed to strength in the labor market and dismissed speculation that the US economy is in a recession. Today, we will see if he was right, as Q2 GDP is expected to be released. If growth comes in negative for the quarter, the United States economy would be in a recession.
Elsewhere, the semiconductor space scored a major victory after the Senate passed the $280 billion CHIPS Act. The bill will now move to the House, which is expected to pass it next week. The CHIPS Act aims to boost semiconductor manufacturing in the United States, boost American research, and lower the country's reliance on China.
Facebook parent, Meta, missed Q2 estimates and offered lower guidance, citing weakness in online ad spending. The earnings miss didn't move the stock much after hours, which could signal that Meta has been sufficiently "beaten down" by Mr. Market.
Chart of the Day:
In the United States, emergency crude oil is stored at the Strategic Petroleum Reserve.