Good morning and Happy Fed Day. The Tech Wreck continued to play out yesterday as semis/memory stocks remained under significant pressure. Tech-heavy Asian indices sold off sharply as a prelude to the US session but the S&P 500 opened only modestly lower, just below the 7400 level that has served as near-term support. The index rallied off those early lows, improving throughout the day but couldn’t quite retest the 50d ma ~7470, ending the day up 0.2%. Despite the selling in tech breadth was much better as the equal-weight rose over 1% and 8/11 sectors ended the day in the green. For Tech, the weakness was concentrated in the semis/memory space. Buyers dipped their toes in, however. The DRAM ETF fell 9% but finished off its lows, and Nvidia worked itself into the green after being down ~2% at its lows. The hyperscalers were mostly up on the day and software was up as well.

As we await the Fed decision this afternoon and more hyperscaler earnings tonight, US equity futures were trading around unchanged this morning and in the middle of the overnight range, though look to be weakening a bit as we approach the Bell. The move is tame despite Brent crude oil reversing yesterday’s decline after Iran launched missiles at US forces in Jordan overnight, and the US targeted Iran-backed groups in Iraq. Before the open, President Trump said that the US will launch strikes against Iran in response to the earlier attacks on US forces in Jordan. Futures fell on the comments but the move was relatively modest.

The Fed rate decision will the key event today. We haven’t seen the market be as unsure of the outcome as for today’s decision in some time, pricing in a ~35% chance of a hike, so it would not be shocking if that would happen. Treasuries are backing up a bit this morning after 3 days of declines, taking into account crude’s strength today. The US Dollar Index is slightly higher. ICE Brent is up ~7% at session highs just under $90. US nat gas prices are a touch lower though prices in Europe are higher. Metals markets were trying to bounce overnight but have turned lower. Crypto is mixed with Bitcoin up slightly while Ethereum pulls back.