Market Talk

So, what'd ya want from me?

US stocks mostly stuck to the FOMC-day script, hewing to a tight range until the statement’s release, and then engaging in their usual fit of volatility as market participants attempted to divine all clues from the mighty Fed.

Post-statement, the first move tends to be the false move, and that was the case today as US stocks shot higher, DJIA gaining almost 90.

There just wasn’t enough fresh stuff from the Fed to sustain a rally, and stocks pulled back just as sharply, with some traders later citing apprehension about tomorrow’s weekly jobless claims and August existing home sales report.

DJIA slides 81.32 points to 9748.55, and Nasdaq Comp sheds 14.88 to 2131.42. S&P 500 ends 10.79 lower at 1060.87.

Perhaps traders do have something to fear in tomorrow’s home sales report.

WSJ’s Bob Hagerty reports that independent housing economist Tom Lawler expects the NAR to report a decline in August existing home sales. Lawler, who tracks local home sales across the country, estimates that August sales ran at a seasonally adjusted annual rate of 4.99M, down about 4.8% from July. A Dow Jones survey conducted Friday and Monday showed the consensus calling for a 2.9% rise.

It does look pretty snazzy

While the tech world eagerly awaits the tablet Apple’s (AAPL) reportedly developing, Microsoft (MSFT) may be readying its own tablet-like device. Images and specs of its version stormed the blogosphere late Tuesday night.

Microsoft’s reportedly developing a device called “Courier” and is currently in the “late prototype” stage of development, Gizmodo reports.

“It’s not a tablet, it’s a booklet,” blog says. “The dual 7-inch (or so) screens are multitouch, and designed for writing, flicking and drawing with a stylus, in addition to fingers.”

The fact that the Courier can fold like a book represents a stark contrast from reported designs of Apple’s tablet. “The Courier user experience presented here is almost the exact opposite of what everyone expects the Apple tablet to be, a kung fu eagle claw to Apple’s tiger style,” Gizmodo says.

Microsoft said it does not comment on rumors or speculation.

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Fed's in no rush to raise rates

BofA/Merrill economists expect the FOMC today “to underscore its ‘go slow’ policy, continuing to promise an ‘extended period’ of low interest rates and giving no hint of an early end to its credit easing policy.”

And while many believe the Fed’s attempt to exit from all its market support programs is akin to threading a needle, the firm says it’s “doable.”

Improvement in the economy and capital markets “will likely be slow, giving the Fed time to plan, test and implement its exit strategy,” BofA says. “This also suggests relative minor disruptions to the capital markets.”

Premarket US stock futures point to a flat open in a couple hours, but as we mentioned yesterday, there’s been an inclination to bid up stocks ahead of the FOMC’s statements this year.

There was some evidence of that in yesterday’s action, and in the absence of any meaningful economic data today, there’s a good chance bulls will try to run some more, at least into the afternoon statement.

After that, who knows? Focus is likely on what the committee says about its efforts to support mortgage lending/housing market, and its intentions on Treasury purchases.

S&P futures up about 3; 10-yr lower yield at 3.47%.