Track Where Your Stocks Are Going After Fed’s Recovery Outlook

After the Fed indicated a less than optimistic view of the recovery, the movement of stocks is signaling a positive outlook, much to the surprise of traders. Stocks recovered some ground yesterday, after buyers drove the yield lower. The yield on the 10-year slipped to 2.779%. Meanwhile, the US dollar has gained 0.3% against the euro, with the pair trading at 1. 3184.

Wednesday’s markets are expected to see the release of earnings from some companies including Cisco (NASDAQ: CSCO), which is set to announce its results after the bell. The S&P technology sector was down 1.2%, and Intel (NASDAQ: INTC) lost 4% after JP Morgan’s downgrade. This is due to choppy tech stocks and concerns about diminishing PC sales.

According to James Paulsen, Chief Investment Strategist of Wells Capital Management, “bonds outpaced stocks and all the economically-defensive sectors were up and all the economic sensitive sectors got clobbered.” Steve Massocca of Wedbush Securities said that yields may “move even lower.” The trend is similar to 2003 when the nation faced a deflation scare, according to Paulsen.

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