30.01.25 - No clear direction

Neither corporate earnings nor the latest Fed decision have provided a clear direction for the market.
Yesterday, the Fed left interest rates unchanged as widely expected. With the press release, Fed Chairman Jerome Powell sent the message that the US central bank intends to keep the interest rates unchanged for the foreseeable future.
Meanwhile, reactions to earnings releases from big tech companies are mixed. While Meta and Tesla are trading higher, Microsoft takes a dip in pre-market trading session.

Markets: China’s market closed for the week (Chinese New Year). The German index DAX is on new record high,
Interest rates decline,

My View: Fed Chairman Jerome Powell’s recent comments did not significantly impact the equity markets. However, interest rates started to decline as investors had concerns on higher inflation and higher interest rates. The market is now pricing in two rate cuts in 2025 in the US, a notable shift from expectations some days earlier in January, when there were discussions about a potential rate hike among investors.

The decline in interest rates is a positive development for my tactical position in long-term Treasuries, as lower rates enhance their value.

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