The much-awaited Fed decision led to its normal dose of volatility, as stocks initially reacted higher but ended up closing in the red. Several other central banks are announcing their decisions in the days ahead as global investors look to judge growth prospects through year-end and into 2025. 👀

Today's issue covers the Fed’s 50 bp cut and updated forecast, Amazon adding perks for its warehouse workers, and 23andMe’s management mass exodus. 📰

Here’s the S&P 500 heatmap. 1 of 11 sectors closed green, with energy (+0.19%) leading and technology (-0.91%) lagging.

And here are the closing prices: 

Most bullish/bearish symbols on Stocktwits at the close: 📈 $VEEA, $NVVE, $OMEX, $APLT, $SPRC 📉 $SCS, $WTI, $MULN, $NWL, $MDAI*

*If you’re a business and want to access this data via our API, email us.

If you were living under a metaphorical or literal rock lately, today was the most consequential “Fed Day” in quite some time, so let’s review what happened and how the market reacted. 👇

First, off consensus expectations were for the Fed to cut 25 basis points (bps), though a minority of the market expected 50 bps because they viewed the move as needed to make up for not cutting at its July meeting.

And as usual, the masses were on the wrong side of the bet (myself included), as the Fed announced a 50 bp cut by an 11-1 vote. Notably, most Fed members were on the same page, but Fed Governor Miki Bowman dissented in favor of a smaller cut…the first dissent by a governor since 2005. 🗳️

Here’s a red-lined version from the WSJ’s Nick Timiraos, showing that the Federal Open Market Committee (FOMC) feels that inflation is moving sustainably toward 2% and that the risks to its employment and inflation goals are ‘roughly in balance.’ ⚖️

The Fed’s updated economic projections also provided some color on its latest move and forecast. Essentially, the new dot plot shows the Fed finally catching up to the expectations that the market has been pricing in since the July meeting.

The Fed funds rate saw the largest adjustment, coming down to 4.40% at the end of the year and 3.40% in 2025. That would mean 50 bps more in cuts before the end of the year and a full percentage point more in 2025. ✂️

Inflation expectations came down, while their economic growth forecast was notched down marginally in 2024 but flat through 2027. Unemployment expectations also rose, but not by a lot…showing that the Fed is continuing to bet on a “soft landing” in the economy.

Jerome Powell’s press conference leaned heavily into the “soft landing” narrative, with Nick Timiraos highlighting some of the key takeaways below. 🎙️

As for the market’s reaction, stocks initially soared alongside gold, bonds, etc., before reversing during Powell’s press conference. Some analysts are concerned that a 50 bp cut is a bad signal for the economy (and the market). 😬

Many circulated a chart similar to @allstarcharts’ below, which shows the S&P 500’s performance after the initial rate cuts. As it shows, 25-bp cuts are generally positive, while performance after an initial 50-bp cut is often challenged.

With the Fed’s move out of the way, eyes turn to the Bank of England and Bank of Japan which are both announcing their latest moves tomorrow. But what’s clear is the world has shifted from higher rates and hikes to lower rates and cuts as inflation fades and countries look to support growth. 🔻

Traders and investors will be watching how the market settles over the coming days as the debate over whether to view this as a ‘successful soft landing’ or an ‘early warning signal’ rages on… 🤷

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While we’re talking about the economy and labor market, it’s worth noting that some parts of the job landscape, especially in the services sector, are still facing challenges. As a result, major retailers like Amazon are having to ramp up their benefits in order to attract and retain workers ahead of the critical holiday shopping season.

Today, the company announced that its warehouse workers will receive a free Prime membership while they’re employed and a pay rise of at least $1.50 per hour beginning next month. This will bring the average base wage for these workers up to over $22 per hour. 💵

This is in addition to the $2.1 billion investment in its Delivery Service Partner program implemented last week to bring national drivers’ average wages to about the same $22 level.

While the company gears up for its busy season with consumers, the stock is again flirting with its 2021/2022 highs, which it failed to break out above. With the Fed’s rate cut news and dovish outlook on the economy, Stocktwits sentiment in ‘bullish’ territory suggests some traders expect the stock to finally make new all-time highs. Time will tell. 🤷

The struggling DNA testing company’s independent board of directors resigned yesterday, shocking employees, investors, and other stakeholders alike. 👨‍💼

These directors had formed a special committee in March to help find a new path forward for the spiraling company but were clearly unable to do so over the last six months as the stock bled to new lows.

CEO Anne Wojcicki told employees she was “surprised and disappointed by the decision” and said she remains committed to taking the company private.

The founder proposed taking the company private in July for $0.40 per share. However, the board rejected this proposal because it was not in the best interest of non-affiliated shareholders. ❌

Speaking of the non-affiliated shareholders, they’ve been absolutely toasted since the genetic testing company went public in 2021 through a special purpose acquisition company (SPAC).

Ultimately, the board of independent directors disagreed with Wojcicki on the company’s “strategic direction” and decided to resign instead of fighting the uphill battle further. 👋

The company will begin searching for new independent directors to join the board as the CEO continues her push to take the company private again for pennies on the dollar.

As for the Stocktwits community, retail investors and traders remain ‘bearish’ on the stock given the shares’ downside momentum and company’s lack of a turnaround plan. Ultimately, it remains a ‘hail-mary’ play that this founder can find the financing to take the company private and give public market investors the closure they need to move on. 👎

Economic data: Turkey Interest Rate Decision (7:00 am ET), England Interest Rate Decision (7:00 am ET), Initial/Continuing Jobless Claims (8:30 am ET), Philadelphia Fed Manufacturing Index (8:30 am ET), South Africa Interest Rate Decision (9:00 am ET), and Existing Home Sales (2:00 pm ET). 📊

Pre-Market Earnings: MoneyHero ($MNY), Darden Restaurants ($DRI), Cracker Barrel ($CBRL), and FactSet Research Systems ($FDS). 🛏️

After-Hour Earnings: FedEx ($FDX), LightPath Technologies ($LPTH), Lennar ($LEN), Genfit ($GNFT), Power ($IPW), and MillerKnoll ($MLKN). 🎧

P.S. You can listen to all of these earnings calls and more straight from the Stocktwits app or website. You’ll find them on the calendar page and individual symbol pages once they’re set to begin! We’ll see you there. 👍

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🤩 Chart Art: The best trade ideas and analysis from the Stocktwits community

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