Rekt Mkts: Stocks bounce after the Fed hike

Well we've got the hike and a bounce this morning, despite the Fed leaving another hike on the table. US futures are recovering from yday's selling Oil is lower too...a better combination than we had going into the meeting.

The Fed raised rates by 25bps to 3.75-4% yday, with all 12 voters in favour. The hike was widely expected; the more important bit was the guidance. The median year-end rate projection is now 4.1%, consistent with another quarter-point hike, rather than a promise that this was one and done. Growth forecasts went up and unemployment forecasts came down, alongside slightly higher inflation projections. So the Fed is still looking at an economy that can take more tightening. The 10Y is still around 5%, while the 2Y reached roughly 4.72% after the decision, up from about 4.67% late Tuesday. We're getting a bounce in risk without much relief in borrowing costs. WTI futures are down about 0.8% near $101.60. There are reports Saudi Arabia is offering extra crude cargoes via Oman to ease the supply disruption. That offers an alternative route for some supply, rather than confirmation the damaged East-West pipeline is back. Gold futures are down about 0.8% near $4,351.

Both SPX and Nasdaq futures are up about 1% this morning. Honestly the FOMC was pretty much bang in line with expectations...almost to the point where it has become a complete nothing burger. With more hikes expected for this year and next, it does feel like it potentially puts a bit of a dampener on the crazy stock rally and I am left asking myself "what's next"...thing is...with uncertainty out of the day, in this environment things generally just tend to levitate higher and my hunch says that's what happens into the end of the year, barring any major surprises.

Majors are bouncing too, with BTC up about 1.1% over 24H, ETH 1.8% and SOL 3.6%. ETH and SOL are doing more of the recovering this morning, after taking the harder hit earlier in the week. It's certainly been quite the move on ZEC and it's starting to feel like to me that's gonna be a front runner for one of the big trades this cycle, particularly given the heavy institutional demand I've been hearing about. I am pretty bullish crypto here, despite the outcome of this week's CLARITY vote SEC chair Paul Atkins has teased releasing new "crypto rules" on Friday...so I think between them and the CFTC we will get the regulation we are after which will be positive for the industry. With the overhang of FOMC + CLARITY votes having blown over, and given the recent crypto strength in the context of the past few weeks, I feel like majors are due a small rebound here before the end of the week...let's see. Good luck today.