Came in as expected, but higher than January. I personally don't think the Fed will cut rates anytime soon. Some subdued cutting this year, maybe 0.25-0.5%. Powell wants his legacy to be killing this bout of inflation and he might be out of a job next year if Trump wins.
What does this mean for markets?
Large cap high cash flow stocks will continue to outperform while small caps keep getting suppressed. Concentration in a few large cap stocks is not a bug but a feature in a high interest rate environment.
Good question. Imo non-factor / good for markets. 0dtes make something discrete (weekly expires into something more continuous, daily expiries). Making something more continuous in markets is usually a good thing. Also we've had 0dtes ever since the introduction of tradable contracts with expiry dates. If you trade the contract on the same day it expires, you're trading a 0dte. The only difference now is that there are more expiry dates.
What are your thoughts on CPI and when the Fed will start cutting interest rates?
Came in as expected, but higher than January. I personally don't think the Fed will cut rates anytime soon. Some subdued cutting this year, maybe 0.25-0.5%. Powell wants his legacy to be killing this bout of inflation and he might be out of a job next year if Trump wins.
What does this mean for markets?
Large cap high cash flow stocks will continue to outperform while small caps keep getting suppressed. Concentration in a few large cap stocks is not a bug but a feature in a high interest rate environment.
0dtes, risky or non-factor?
Good question. Imo non-factor / good for markets. 0dtes make something discrete (weekly expires into something more continuous, daily expiries). Making something more continuous in markets is usually a good thing. Also we've had 0dtes ever since the introduction of tradable contracts with expiry dates. If you trade the contract on the same day it expires, you're trading a 0dte. The only difference now is that there are more expiry dates.