NO ONE CAN MAKE UP TODAY’S NARRATIVE

Where to? Today can be a significant day given the Netherlands referendum, the Fed meeting and the continued diplomatic issues between two NATO allies — The Netherlands and Turkey.

Regarding Fed policy, the markets are expecting a 0.25% increase in the fed funds rate and have fully discounted an additional 0.50% increase by year end. Will FRB Chair Yellen suggest policy that may become more hawkish during the press conference? Yes, if the data suggests that such policy is appropriate.

What are the odds of such? Many times I have mentioned surging consumer and small business sentiment. Yesterday, Bloomberg reported that optimism from CEOs jumped by the greatest amount since the end of 2009. I think this is significant.

The largest companies have fully supported the globalist environment. As inferred above, globalism can be on the cusp of yet another setback and thus begets the question of why the surging optimism by the largest companies?

According to Bloomberg, these leviathans are encouraged by Trump’s plays: cutting taxes, reducing regulations and investing in infrastructure. Jamie Dimon, CEO of JP Morgan, stated the animal spirits after being caged for the past eight years have been released.

Several times during the campaign, I referenced a NYT article indicating not a single CEO of an S & P 100 company endorsed Donald Trump. Have attitudes changed?

If so, and if sentiment continues to remain robust by both the consumer and small business owners, I would expect more hawkish comments by the FRB Chair in the intermediate future.

What will happen today? Will trading be muted until the 200 PM Fed announcement?

Last night the foreign markets were mixed. London was up 0.19%, Paris was up 0.13% and Frankfurt was up 0.02%. China was up 0.08%, Japan was down 0.16% and Hang Sang was down 0.15%.