By: Dividend Sensei
While many will be focusing on what the Fed does with short-term interest rates this week, that’s actually far less important to stocks than these three things, all of which could move the market far more.
Over the last decade, few things have moved the markets more than what the Federal Reserve does with monetary policy. In fact, it was the Fed taking an excessively hawkish stance on interest rates and its balance sheet roll-off (quantitative tightening) that caused the S&P 500, Dow Jones Industrial Average, and Nasdaq to go into free-fall in late December 2018. That culminated in stocks bottoming 19.8% from September’s high and came very close to ending the longest bull market in US history.
The Fed is meeting 6 times this year, but the quarterly meetings are by far the most important, and the next one is this week. And while investors might care about what the Fed does in terms of short-term interest rates on Wednesday, March 20th, this is actually the least important thing to focus on.
Here are the three things with the greatest potential to send stocks soaring, or plummeting, that investors may want to watch closely.