MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN MSFT AND GOOGL LONG-TERM
3 Actionable Takeaways
Watch for a potential volatility crush following the Fed announcement, which could temporarily lift stock prices.
Liquidity conditions are tightening, with higher effective Fed funds and SOFR rates suggesting stress in overnight funding.
Major tech earnings from Microsoft, Alphabet, and Meta may reset implied volatility levels and create short-term selling pressure if expectations aren’t significantly exceeded.
Market liquidity is tightening as short-term rates rise ahead of the Fed’s potential decision on ending quantitative tightening. A mechanical volatility crush post-FOMC could briefly boost markets. However, structural factors point to a possible stall or reversal in the stock market rally post Fab 5 Earnings on Wednesday and Thursday.