Stock Market Update

[BRIEFING.COM] The election outcome is the focal point today and it will likely remain so over the remainder of the week. On Thursday, however, it will have to share the spotlight with the Fed's monetary policy decision.

The FOMC is widely expected to cut the target range for the fed funds rate by 25 basis points to 4.50-4.75%. The intrigue with this meeting will revolve around Fed Chair Powell's press conference and how he frames the policy approach for future meetings.

Mr. Powell will most likely assert that the Fed is going to be data dependent and that decisions will be made on a meeting-by-meeting basis, but with stocks rallying today to record highs, bolstering the wealth effect, and Treasuries sinking today, presumably in part because of inflation concerns, market participants will be listening closely to hear if Fed Chair Powell thinks the FOMC could have some room to wait on another rate cut given that inflation has still not reached the Fed's 2% target.

Currently, there is a 67.4% probability of another 25-basis points rate cut tp 4.25-4.50% at the December FOMC meeting versus 77.3% yesterday, according to the CME FedWatch Tool.