(As of 7:10 am PST)
Today marks the end of a week that saw the Dow Jones Industrial
Average snap a 7 day win streak with a mid-week selloff followed by a rally
that brought the major indices to their highest levels since August. This back
and forth trend makes it difficult to predict how the week will end especially
since there isn’t much fundamental ground for any of these movements to stand
on. The prevailing thought that continues to drive this upward trend is the
sentiment that the Fed won’t raise interest rates before the end of the year.
But as we have said before, the premise of this decision is built on bad
economic data. Third quarter earnings reports are for the most part supporting
the bad economic news theme. Companies like Mattel, WD-40 Company, W.W.
Grainger and Kansas City Southern all missed their estimates while Wynn
Resorts, General Electric, Honeywell and Schlumberger were all in-line or
topped estimates. The one thing all of these companies managed to have in
common is that not one of them reported a year-over-year increase in revenue.
It’s a light reporting day with reports on industrial production and job
openings due out later today. Oil prices are up today following a down day
yesterday based on news that there was a large addition to U.S. crude
stockpiles last week which is a sign that the global oversupply of crude isn’t
going away. Gold is down slightly in early trading.
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