Stocks are set to exit October with a tailwind, as the market enters a historically positive time of year. The Federal Reserve’s meeting Tuesday and Wednesday is the key to the week ahead, and the outcome could also help decide how markets will trade for the rest of the year.
The Fed is expected to raise its fed funds target rate by three-quarters of a point, but there is some expectation that Fed Chairman Jerome Powell could signal that the Fed is considering paring back the size of future rate hikes. Stock strategists say that could help keep the rally going.
October has been positive for the market despite the volatility and major declines in some Big Tech names. The Dow, as of Friday, was up 14.4% for the month, its best monthly performance since 1976. Besides the Fed, there is a heavy economic calendar, with Friday’s September jobs report the most important report. It is also a very busy week for earnings, with about a third of S&P 500 companies reporting.
