The Monday Market Minute

  • Global stocks rally as China markets roar, investors extend stimulus bets heading into the U.S. earnings season.
  • Around 31 companies will report this week, including the country’s biggest banks, with analysts expecting third quarter profits to fall 21% from last year.
  • Apple unveils is new line-up of 5G phones on Tuesday, the same day that Amazon will launch its annual ‘Prime Day’ shopping event.
  • President Trump renews call for stimulus deal, but confusion grips talks as both sides play politics 22 days ahead of the November elections.
  • Europe records 100,000 daily coronavirus cases, the highest tally since the pandemic began, in what is likely to be an omen for a second U.S. wave as domestic weather cools.
  • U.S. equity futures suggest a firmer open on Wall Street, following its best five-day stretch since August, ahead of big bank earnings and key consumer sentiment events in the week ahead.

U.S. equity futures edged higher Monday, while global stocks rallied and oil prices fell, as investors braced for a critical week ahead that could define the market’s direction heading into the final months of the year.

With Wall Street still looking for clarity on stimulus heading into the teeth of the third quarter earnings season, as well as a series of events that will gauge the strength of the U.S. consumer, stocks are holding onto solid October gains, with the Dow Jones Industrial Average creeping into positive territory for the year on Friday.

However, Europe’s recent coronavirus surge, which has lead to a record high 100,000 daily cases across the Continent Sunday, serves as a reminder that the U.S. economy is almost certain to face a similar ‘second wave’ as the domestic weather cools in the coming weeks.

Without stimulus from Washington — which appears as deadlocked and

“There is only one side to the stock market; and it is not the bull side or the bear side, but the right side.”Jesse Livermore

Anyone who follows the equity market realizes that they are faced with what I described last week as a foggy outlook in the near term. When that occurs, I try not to get swayed and then sidetracked into forgetting the long-term trends that are in place.

An investor has to be reactionary waiting for the market to give them clues, then reacting appropriately. I take my leads from price action, momentum, sentiment, and other indicators. All designed for me to decipher what the market is telling me. Never drifting too far from the one key that serves as the foundation of my current strategy. That is staying focused on the major trend that is in place, and that remains without question in favor of the bulls.

Once established that trend should be followed until there is evidence that a discernible change is taking place. This bull market has been marked by the masses that keep looking for reasons to abandon this trend. As each month passes, another reason is rolled out why the equity market is filled with more downside risk than upside gains.

Sentiment as a contrary indicator has been a tailwind for anyone bullish. Excessive bullishness would imply the exhaustion of buying power. What we have witnessed for quite some time is that traders and investors appear to be subdued and cautious. The new highs recorded for the S&P just one month ago and the 42 all-time highs recorded by the NASDAQ in 2020 should have given a boost to enthusiasm for equities. Instead, it is met with a yawn.

Major market tops simply do not occur with the amount of

The Friday Market Minute

  • Global stocks press forward on U.S. stimulus hopes, with gains in Europe capped by a worrying surge in coronavirus infection rates.
  • House Speaker Nancy Pelosi and Treasury Secretary Steve Mnuchin will resume talks Friday, with President Trump pressing for stand-alone agreements versus the Democrats preference for a comprehensive relief bill.
  • European coronavirus infections are rising at record levels in many major economies as the autumn weather turns, but leaders are hoping to avoid sweeping lockdowns in the weeks ahead.
  • Oil prices on pace for a 10% week gain on supply outages and improving demand, while the dollar tumbles to a three-week low against a basket of its global peers.
  • U.S. equity futures suggest a firmer open on Wall Street, which is looking at its best five-day stretch since August, heading into the teeth of the third quarter earnings seasons next week.

U.S. equity futures edged higher Friday, while the dollar retreated to a three-week low and oil prices slipped, as investors consolidated gains from the best week on Wall Street since mid-summer and braced for what could be a game-changing series of events in the coming days.

With markets still clinging to hopes that House Democrats and their Republican rivals in the Senate can reach an agreement on a coronavirus relief bill in the final three weeks before the November Presidential elections, the S&P 500 has gained around 2.9% so far this week, building its advance around solid corporate sales updates, progress in coronavirus vaccine development and modestly improving jobs numbers.

House Speaker Nancy Pelosi and Treasury Secretary Steve Mnuchin will continue their weeks-long negotiations Friday, with President Donald Trump pressing for a series of ‘stand alone’ stimulus deals instead of the comprehensive $2.2 trillion package preferred by Democrats.

The third quarter earnings season will unofficially

Stocks closed near session highs on Wednesday as investors bet a stimulus plan, full or partial, will come together after President Trump dialed back plans to scrap the talks.

Ticker Security Last Change Change %
I:DJI DOW JONES AVERAGES 28303.46 +530.70 +1.91%
I:COMP NASDAQ COMPOSITE INDEX 11364.598929 +210.00 +1.88%
SP500 S&P 500 3419.45 +58.50 +1.74%

The Dow Jones Industrial Average was up over 530 points or 1.9% while the S&P 500 and Nasdaq Composite rose over 1.7 and 1.8%, respectively.

Transportation stocks soared to a fresh record, as did consumer discretionary names, both would likely benefit from a stimulus deal.

Ticker Security Last Change Change %
XTN SPDR SERIES TRUST SPDR S TR/S&P TRANSN ETF 60.77 +1.42 +2.39%
XLY CONSUMER DISCRETIONARY SELECT SECTOR SPDR ETF 150.82 +3.37 +2.29%

Trump reversed an earlier stance and signaled he would be willing to sign bills from Congress to support the economy.

He said he would sign a “stand alone bill” for another round of economic stimulus checks in the amount of $1,200. He also promised help for the battered airline industry in the form of $25 billion in relief and also touted releasing funds for small businesses from the Paycheck Protection Program.

Airlines In Focus

All the major airlines rallied as talk of a separate rescue package for the embattled group gains attention between House Speaker Pelosi and Treasury Secretary Mnuchin.

Ticker Security Last Change Change %
AAL AMERICAN AIRLINES GROUP INC. 13.07 +0.54 +4.31%
DAL DELTA AIR LINES INC. 32.15 +1.09 +3.51%
UAL UNITED AIRLINES HLDG. 36.38 +1.50 +4.30%
LUV SOUTHWEST AIRLINES CO. 38.59 +1.01 +2.69%
JBLU JETBLUE AIRWAYS 12.29 +0.78 +6.78%

SOUTHWEST CEO PUSHING PAY CUTS

FOMC Warns On Lack

The Wednesday Market Minute

  • Global stocks mixed as markets react to contradictory statements on stimulus from President Donald Trump.
  • Hours after ordering White House officials to stop negotiating with Democrats, Trump suggested he would sign a ‘stand alone’ bill to support airlines and small businesses.
  • White House economic adviser Larry Kudlow tells CNBC a piecemeal agreement on stimulus is a “low probability event”.
  • The U.S. dollar edges higher amid the stimulus uncertainty, made more complicated by the President’s coronavirus diagnosis, while benchmark 10-year Treasury yields hold at 0.764%.
  • Oil prices eases as the Energy Department trims near-term demand forecasts and Hurricane Delta slows to a category 3 storm as it heads towards the crude production areas of the Louisiana coast.
  • U.S. equity futures suggest a firmer open on Wall Street, with a 240 point gain priced for the Dow Jones Industrial Average.

U.S. equity futures powered ahead Wednesday, while the dollar inched higher against its global peers, as markets reacted to a U-turn on stimulus talks from President Donald Trump that could signal a breakthrough in talks from lawmakers in Washington.



Dow Futures Gain on Trump Stimulus U-Turn; Dollar Grinds Higher As Markets Eye Talks in Washington


© TheStreet
Dow Futures Gain on Trump Stimulus U-Turn; Dollar Grinds Higher As Markets Eye Talks in Washington

Just hours after ordering his White House staff — many of whom remain in self-isolation following the his coronavirus infection last week — to cease negotiating with Democratic lawmakers to try and bridge a $600 billion gap between rival stimulus bills, Trump Tweeted his willingness to sign a ‘stand alone’ agreement that would provide paycheck protection to small businesses and $25 billion in support to U.S. airlines.

https://twitter.com/realDonaldTrump/status/1313658825040371712

While a smaller, more targeted bill is something House Speaker Nancy Pelosi has advocated for in the past, it’s difficult to tell at this stage in the election campaign, with just four weeks