The FOMC meeting will conclude and make their announcement on interest rate movement. The Fed is expected to lower the rates to 1.5-1.75% from 1.75-2% that exists today. That would be a quarter point drop. Also, next week is the first estimate of the third quarter GDP number and the expectation is for 1.9% growth from the quarter before of 2%.
These two numbers with earnings reports pouring in for Q3 will be the focus next week. The interest rate drop is already built into the stock prices, but the Fed will release a statement and any hints on future direction will be parsed a million different ways. If the market feels the Fed is not going to be strident on pushing down future rates the market can easily roll over. Also, we are expecting a weaker GDP number but it better be in the range of expectations because if its weaker than that stocks will fall.
Investors always look forward, but the actual news next week may not drive stocks; the rumors will, and any surprises to either the upside or down-side always makes them nervous.
Next week could be a bumpy ride.