Economic Journal - Friday, 10/30/2015

(As of 7:05 am PST)

Markets inched higher at the open of Friday’s trading session, but are now meandering near the unchanged line as investors sifted through mostly positive earnings reports and a mixed batch of economic data. Earnings from Chevron, ExxonMobil and Starbucks all met or exceeded expectations helping to set the tone early. Economic data is mixed today with a report on personal income and spending falling short of expectations in September. Consumer spending rose 0.1%, the smallest amount since the start of the year, as consumers spent less at the pump due to another significant drop in oil prices. On the positive side, business activity as measured by the Chicago PMI, surged in October, rising from contraction territory in September back to the highest level since January. In other important news, the Senate passed a budget bill early Friday that would avoid a government shutdown and raise the debt ceiling. International markets are lower heading into the weekend, perhaps on news that the Bank of Japan has decided to leave its monetary policy unchanged. Gold and oil prices are down slightly while interest rates are inching higher. Heading into today’s session the S&P500 is up nearly 9% in the month of October – the best month for stocks in 4 years. It wouldn’t be a surprise to see some consolidation activity in the coming weeks, however the case for a year end Santa Claus rally still looks plausible.