This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Global Macro: Fed, Tech Earnings to Test Equities

Stocks in this article: SPY QQQ AAPL AMZN MSFT FB

NEW YORK ( TheStreet) -- U.S. equities will be tested this week at record highs as the Federal Reserve meeting and earnings from major technology companies may send stocks lower.

Fed monetary stimulus and strong momentum from tech companies have pushed equity markets to record highs in weeks past.

The Fed is expected to keep policy accommodative till 2014 due to the consequences of the government shutdown and the slow recovering labor market. The issue is not whether the Fed tightens this week, because it probably won't, but rather, what kind of guidance it will provide.

If the Fed gives a hawkish tone and leads investors to believe it is not fully committed to stimulus relatively deep into 2014 once the government shutdown reverberations have subsided, then the market may see this as a sign to sell.

On the other hand, if the Fed acknowledges the economy's weakness and makes it clear that stimulus is indefinite at this point, then that could keep the market at its lofty levels.

Strong tech earnings, meanwhile, have kept sentiment elevated in the recent run to equity highs. Companies such as (AMZN) and Microsoft (MSFT) have outperformed expectations and helped the PowerShares QQQ (QQQ) keep its strong uptrend.

This week, Facebook (FB) and Apple (AAPL) release their earnings. If they outperform expectations, then there is no reason for a selloff and equities could again close on fresh highs for the week.

The technical outlook for the market remains positive. Late last week, the SPDR S&P 500 (SPY) pushed higher, as pictured below. The move looked strong and helped push the index out of a multi-day consolidation.

Although one could make the argument for equities being overbought, there's no reason for a correction just yet. But a catalyst could emerge this week.

At the time of publication the author had no position in any of the stocks mentioned.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

Andrew Sachais' focus is on analyzing markets with global macro-based strategies. Sachais is a chief investment strategist and portfolio manager at the start-up fund, Satch Kapital Investments. The fund uses ETF's traded on the U.S. stock market to gain exposure to both domestic and foreign assets. His strategy takes into consideration global equity, commodity, currency and debt markets. Sachais is a graduate of Georgetown University, where he earned a degree in Economics.

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs