Need To Know: The Fed Easily Could Make Stocks Spring Higher, Says J.P. Morgan

On this first official day of spring, it’s still feeling wintery for stocks, especially if you’re a Facebook bull.

But a present could be coming from the Federal Reserve, which certainly gets likened to the Easter bunny from time to time.

That’s the suggestion from our call of the day, provided by a team of J.P. Morgan equity strategists led by Dubravko Lakos-Bujas.

He and his colleagues are assessing the two-day Federal Open Market Committee meeting that starts today and ought to offer up an interest-rate hike tomorrow — along with fresh market-moving signals. The key for JPM is how the backdrop has changed.

“Last December’s hawkish FOMC release came after a sustained market rally coupled with remarkably low volatility,” the strategists write in a note.

“In contrast, the upcoming FOMC meeting is preceded by a market crash, elevated volatility, rising negative sentiment around trade, while [the] consensus view of the Fed remains hawkish (i.e. FOMC dots to be revised higher).”

See: What to expect from the new Fed dot plot on interest rates

So that could mean a stock-market rally wouldn’t be that hard to produce, according to the big bank’s team. Here’s how Lakos-Bujas & Co. put it: “Given this backdrop, even a slightly dovish Fed outcome would set up a rather low bar for equities to advance.”

The cooing could come during Fed chief Jerome Powell’s news conference tomorrow afternoon, according to other analysts. He’s expected to use his 60 minutes with reporters post-meeting to turn down the temperature and stress that rate hikes will be remain gradual, writes MarketWatch’s Greg Robb.

Check out: 5 things to watch from the Fed decision

Key market gauges

Futures for the Dow YMM8, +0.03%  , S&P 500 ESM8, +0.12% and Nasdaq-100 NQM8, +0.07% are little changed, after the Dow DJIA, -1.35%  , S&P SPX, -1.42% and Nasdaq Composite COMP, -1.84% closed sharply lower yesterday, with the blue-chip gauge turning negative for the year.

Europe SXXP, +0.33% is edging up, and Asia closed mixed. Oil CLJ8, +1.40% is gaining, as is the dollar index DXY, +0.31% , while gold GCJ8, -0.52% is dipping. Bitcoin BTCUSD, +1.25% is changing hands around $8,500.

See the Market Snapshot column for the latest action.

The chart

The tech giants are down, but not out. That’s what many chart watchers are saying while looking at the latest moves by the Nasdaq-100 Index NDX, -2.21%  , whose big components are Apple AAPL, -1.53%  , Amazon AMZN, -1.70%  , Microsoft MSFT, -1.81%  , Facebook FB, -6.77%  , Alphabet GOOG, -3.16% GOOGL, -3.03% and so on.

The tech-laden benchmark QQQ, -2.13% so far has held above its 50-day moving average, a closely watched chart level. But the anonymous blogger behind the Heisenberg Report doesn’t sound that impressed: “Apparently, the 50-DMA is providing some ‘support’ (for those of you who are into lines).”

Meanwhile, financial blogger and trader ChessNwine says the overall market’s next move will probably hinge on whether “those big, bad Nasdaq stocks” and small caps IWM, -0.96% manage to stay above their respective 50-day lines.

The quote

“It doesn’t have to be true. It just has to be believed.” —Cambridge Analytica CEO Alexander Nix was caught saying that on a hidden camera.

The political data company at the heart of Facebook’s latest big problem was secretly filmed pitching dirty tricks and touting its ability to influence elections. The video was gathered and broadcast by the U.K.’s Channel 4 News.

The buzz

Could the Facebook flap could mean more regulations on tech giants? A European Union official is set to quiz her U.S. counterparts over privacy issues.

Facebook’s chief security officer says he’s still working, but Alex Stamos doesn’t directly address reports that he’s planning to leave.

Meanwhile, Facebook FB, -6.77% reportedly plans to hold an emergency meeting today to let employees ask questions about Cambridge Analytica.

A package exploded overnight at a FedEx distribution center in Texas, hurting one person, and authorities say it is likely linked to recent attacks in Austin by what they believe is a serial bomber

Oracle ORCL, -0.61% looks set for a down day after the tech giant’s earnings late yesterday.

Read more: Cloud reality is here for Oracle

More than 70% of Tesla’s biggest fans didn’t buy a Model 3 when they had the chance.

President Trump is expected to ask Saudi Crown Prince Mohammed Bin Salman to do more to help end Yemen’s civil war, when the two leaders meet today in Washington, D.C.

“We are resolved to fight the bloody battle against our enemies ... with a strong determination to take our place in the world,” said Chinese President Xi Jinping in a nationalistic speech Tuesday.

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It’s the spring equinox so stand an egg on its end? Not exactly.

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Say hello to Jeff Bezos’ little robotic friend:

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