(November 12 – 18:00 ET) – With traders divided on the inevitability of an interest rate hike next week, there’s
plenty of trading room in equities regardless of which way the U.S. Federal Reserve
Board decides to swing, say Economists at CIBC World Markets Inc..
CIBC favours a 25 basis point hike, but says only 50% of the move is already priced into the market. As a result, they are expecting a strong negative trade if the Fed does hike.
On the other hand, CIBC expects a hike to come with a statement indicating that the Fed is done
raising for a while, moderating the trade. Once that’s over CIBC sees
markets trading up through the week.
CIBC also expects the Bank of Canada to finally follow the Fed, due to some strong economic results in recent weeks.
-IE Staff
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