Woods: Everything about this Fed meeting is anticipation

Market Impact - Nvidia shares have declined following a directive from the Chinese internet regulator advising local companies against purchasing Nvidia chips, resulting in a 1% drop in pre-market trading [1][2][3] - Despite the decline, it is not expected to derail Nvidia's overall performance, but may cause a temporary stall [3] Federal Reserve Expectations - Anticipation surrounds the upcoming Federal Reserve meeting, with expectations of a 25 basis point cut already priced in [4][5] - There is speculation about the potential for multiple cuts and how the Fed Chair will communicate these changes, which could lead to a "sell the news" effect in the market [5][6] Sector Performance - Cyclical sectors such as industrials, materials, and financials have underperformed since the Jackson Hole meeting, suggesting a potential rotation in market leadership [8][9] - Consumer discretionary is highlighted as a leading sector, with significant contributions from major stocks like Amazon, Tesla, and Home Depot [9][11][12] Housing Market Influence - The decline in mortgage rates to a three-year low is seen as a significant tailwind for the housing market, potentially benefiting companies like Home Depot and Lowe's [13][14] - A further drop in mortgage rates below 6% could provide substantial support for the housing sector [14] Market Outlook - The 10-year Treasury yield is viewed as a critical indicator for market direction, with a potential rally if it falls below 4% [15]