Mike Zigmont, author of the Zigmont Report, is a partner at New York-based Harvest Volatility Management, a hedge fund with over $10B AUM, offering volatility management solutions to its investor base worldwide. Mike has been publishing his daily newsletter (Monday-Friday) privately for the firm’s investors and his personal contacts in the investment business
since 2008, sending shortly after the market close.
The opinions expressed below are my own and do not necessarily represent those of Harvest Volatility Management, LLC
Slow. Earnings continue to beat but enthusiasm for higher stock prices took a pause (at least for today). Capital flow was 94%, which seems almost normal, but today was option expiration and normally that pushes flow to 120-130%. So activity looks about average although it was actually quite light.
That makes sense but it isn’t very newsworthy. Today was a lazyFriday
in summer at that basically sums things up. Next week is thick with more earnings results and also the Fed announces their next decision on Wednesday the 26th. No changes are expected. Of 90 published estimates on Bloomberg, zero expect interest rates to change. Futures market are pricing in a 0% chance of a hike. Remember that during this normalization process the Fed doesn’t want to rattle markets. If it were going to *do
* something, it would’ve begun managing expectations weeks ago. The fact that it hasn’t means that the market is correctly anticipating its policy. Don’t expect the Fed to shake things upon Wednesday
. The market will be looking for guidance as to when balance sheet contraction will begin (Sep is consensus) and when the next hike will happen (Dec is consensus). We will be parsing the statement towards those ends because there will be no press conference after. Have a great weekend, see youMonday
,-Mike
