Stock Market Warning - Fed Dot-Plot Will Surprise People

After recommending stocks at their turn in February, I am now seeing the first real challenge for equities this week. The Fed is not expected to raise interest rates, however, investors have not yet honestly considered what the Fed’s dot-plot forecasts will show for rate expectations this year. I expect it will be a forecast that is not consistent with what the market expects, and stocks face a setback as a result. Energy prices could also be impacted as the dollar strengthens and due to Fed braking. However, financial sector strength on the same news should eventually help to support the broader market, as should the fact that the Fed is probably not acting on rates this month. For this reason, I’m simply warning investors here to be prepared for volatility and consider hemming and hedging some long bets heading into the data, especially in certain riskier sectors. Raising some cash now and adding portfolio protection is also appropriate in my estimation. However, gold is not favored, due to expected dollar strength on the Fed trajectory. See the full Warning on Stocks here.

Security Sector	03-15-16 Early Indication
SPDR S&P 500 (NYSE: SPY)	-0.6%
SPDR Dow Jones (NYSE: DIA)	-0.5%
PowerShares QQQ (Nasdaq: QQQ)	-0.3%
iShares Russell 2000 (NYSE: IWM)	-0.8%
Vanguard Total Stock Market (NYSE: VTI)	-0.7%
Financial Select Sector SPDR (NYSE: XLF)	-0.9%
Technology Select Sector SPDR (Nasdaq: XLK)	-0.3%
Energy Select Sector SPDR (NYSE: XLE)	-1.3%
Health Care Select Sector SPDR (NYSE: XLV)	-0.8%
Consumer Discretionary Select Sector SPDR (NYSE:  XLY)	-0.5%
Consumer Staples Select Sector SPDR (NYSE: XLP)	-0.3%
Utilities Select Sector SPDR (NYSE: XLU)	-0.2%
Materials Select Sector SPDR (NYSE: XLB)	-1.3%
Industrial Select Sector SPDR (NYSE: XLI)	-0.9%
iPath S&P 500 VIX ST Futures (NYSE: VXX)	+3.3%
SPDR Gold Trust (NYSE: GLD)	-0.1%
United States Oil (NYSE: USO)	-1.7%

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only. Article should interest investors in SPDR Dow Jones Industrial Average (NYSE: DIA), SPDR S&P 500 (NYSE: SPY), PowerShares QQQ Trust (Nasdaq: QQQ), ProShares Short Dow 30 (NYSE: DOG), ProShares Ultra Short S&P 500 (NYSE: SDS), ProShares Ultra QQQ (NYSE: QLD), NYSE Euronext (NYSE: NYX), The NASDAQ OMX Group (Nasdaq: NDAQ), Intercontinental Exchange (NYSE: ICE), E*Trade Financial (Nasdaq: ETFC), Charles Schwab (Nasdaq: SCHW), Asset Acceptance Capital (Nasdaq: AACC), Affiliated Managers (NYSE: AMG), Ameriprise Financial (NYSE: AMP), TD Ameritrade (Nasdaq: AMTD), BGC Partners (Nasdaq: BGCP), Bank of New York Mellon (NYSE: BK), BlackRock (NYSE: BLK), CIT Group (NYSE: CIT), Calamos Asset Management (Nasdaq: CLMS), CME Group (NYSE: CME), Cohn & Steers (NYSE: CNS), Cowen Group (Nasdaq: COWN), Diamond Hill Investment (Nasdaq: DHIL), Dollar Financial (Nasdaq: DLLR), Duff & Phelps (Nasdaq: DUF), Encore Capital (Nasdaq: ECPG), Edelman Financial (Nasdaq: EF), Equifax (NYSE: EFX), Epoch (Nasdaq: EPHC), Evercore Partners (NYSE: EVR), EXCorp. (Nasdaq: EZPW), FBR Capital Markets (Nasdaq: FBCM), First Cash Financial (Nasdaq: FCFS), Federated Investors (NYSE: FII), First Marblehead (NYSE: FMD), Fidelity National Financial (NYSE: FNF), Financial Engines (Nasdaq: FNGN), FXCM (Nasdaq: FXCM), Gamco Investors (NYSE: GBL), GAIN Capital (Nasdaq: GCAP), Green Dot (Nasdaq: GDOT), GFI Group (Nasdaq: GFIG), Greenhill (NYSE: GHL), Gleacher (Nasdaq: GLCH), Goldman Sachs (NYSE: GS), Interactive Brokers (Nasdaq: IBKR), INTL FCStone (Nasdaq: INTL), Intersections (Nasdaq: INTX), Investment Technology (NYSE: ITG), Invesco (NYSE: IVZ), Jefferies (NYSE: JEF), JMP Group (NYSE: JMP), Janus Capital (NYSE: JNS), KBW (NYSE: KBW), Knight Capital (NYSE: KCG), Lazard (NYSE: LAZ), Legg Mason (NYSE: LM), LPL Investment (Nasdaq: LPLA), Ladenburg Thalmann (AMEX: LTS), Mastercard (NYSE: MA), Moody’s (NYSE: MCO), MF Global (NYSE: MF), Moneygram (NYSE: MGI), MarketAxess (Nasdaq: MKTX), Marlin Business Services (Nasdaq: MRLN), Morgan Stanley (NYSE: MS), MSCI (Nasdaq: MSCI), MGIC Investment (NYSE: MTG), NewStar Financial (Nasdaq: NEWS), National Financial Partners (NYSE: NFP), Nelnet (NYSE: NNI), Northern Trust (Nasdaq: NTRS), NetSpend (Nasdaq: NTSP), Ocwen Financial (NYSE: OCN), Oppenheimer (NYSE: OPY), optionsXpress (Nasdaq: OXPS), PICO (Nasdaq: PICO), Piper Jaffray (NYSE: PJC), PMI Group (NYSE: PMI), Penson Worldwide (Nasdaq: PNSN), Portfolio Recovery (Nasdaq: PRAA), Raymond James (NYSE: RJF), SEI Investments (Nasdaq: SEIC), Stifel Financial (NYSE: SF), Safeguard Scientifics (NYSE: SFE), State Street (NYSE: STT), SWS (NYSE: SWS), T. Rowe Price (Nasdaq: TROW), Visa (NYSE: V) and Virtus Investment Partners (Nasdaq: VRTS).