Stocks didn’t like the Federal Reserve news late yesterday, and they don’t like it again this morning. More on that in a minute. Gold and silver are also down notably, while crude oil has slipped back below $90 a barrel. Treasuries are lower, while the dollar is higher.

On the news front...

You know the slogan you see on cheesy pirate-themed signs? The one that says: “The beatings will continue until morale improves”? Well, it turns out that was the general message from Fed Chairman Jay Powell at yesterday’s policy meeting.

Specifically, the Fed did NOT raise its benchmark interest rate again from its current 5.25% - 5.5% range. But policymakers signaled in associated meeting documents that they’re leaning toward at least one more rate hike in 2023. Plus, their forecasts for how much rates could subsequently be lowered next year after inflation comes down were reduced. In other words, the message was “Rates could GO higher...and when they do, they could REMAIN higher for LONGER.”

Of course, when you see headlines like the one “Higher Interest Rates Not Just for Longer, But Maybe Forever” in the Wall Street Journal, you have to wonder if maybe the worrywarts on Wall Street have gone a little TOO far. But for now at least, the Fed’s “hawkish pause” has roiled markets – even as the Bank of England decided to skip a hike this morning after 14 straight increases. The Swiss National Bank also stood pat.

In the M&A arena, telecommunications and networking tech giant Cisco (CSCO) said it would buy the cybersecurity company Splunk (SPLK) for $28 billion. The cash deal values SPLK at $157 per share, up sharply from the previous closing price of $119.59.

Finally, we haven’t seen much progress with the autoworker strike. The United Auto Workers (UAW) union is continuing to seek pay increases of up to 40% as well as other retirement and employment benefits. But the Big Three have stuck to their guns, and are now starting to lay off workers at other plants in response to the work stoppages.

Shares of General Motors (GM) are off about 8% in the last month. Ford Motor (F) is down 3%, while Stellantis (STLA) is actually up about 2%.