One step forward, two steps back
Dow futures closed down 36 points Wednesday, after a quiet consolidated session. The futures were limited to a 100 point range, with most of that taking place in overnight trading. The day session saw a lot of back and forth trading, staying in an even tighter range of 60 points for the entire day. Wednesday was quite a subdued day coming off of the volatile sessions we saw Monday and Tuesday.
Thursday will bring us weekly Jobless Claims and GDP, which could give a spark to trading. The market hasn’t had too many back to back “quiet” days since January. I am looking for some more volatility to continue heading into the weekend.
Things to watch
For the near future, and the extended future as well, the markets are going to listening to and reacting to anything tax related. What I mean by that is anything pertaining to tax reform, repatriation, or tax code will be viewed with a microscope. Coming out of January the market itself was optimistic , if not bullish, to the idea that tax reform and some deregulation were around the corner. Now that plans are being proposed and we get to see the nuts and bolts, everything isn’t so rosy. Anything that appears to be an obstacle will be interpreted negatively. Anything that appears to be a step closer to reform, will be a plus, but perhaps a bit more limited than it was in January.