IT WAS MERGER MONDAY

Equites were moderately higher yesterday on a flurry of merger announcements. Optimism is also rising that earnings will turn positive this quarter, the first such occurrence in six quarters.

More than a third of the S & P 500 are scheduled to report results this week.

Treasuries were nominally lower in price, partially the result of futures now suggesting a 70% chance of a rate hike by December up from about 66% on Friday.

Oil fell about 1% as Iraq stated it should be excluded from production curbs because it is embroiled in a war with Islamic militants.   I ask what OPEC nation is not fighting a war?  Russia refused again on Sunday to commit to joining OPEC in trimming production.

What will today’s inventory data suggest?  Will stores decline for the seventh of eight weeks?

There is two weeks until the election.  I am certain it will get nastier especially if the polls tighten as they historically do during the last 14 days.  Speaking of polls, if Trump is elected, this would be even a larger upset than Dewey vs. Truman in 1948 with the establishment being completely out of touch with the electorate.

What will happen today?

Last night the foreign markets were up.  London was up 0.43%, Paris up 0.06% and Frankfurt up 0.31%.  China was up 0.36%, Japan up 0.76% and Hang Sang down 0.17%

The Dow should open little changed.   The 10-year is off 3/32 to yield 1.78%.

 

The views expressed herein are those of Kent Engelke and do not necessarily reflect those of Capitol Securities Management. The information contained herein has been compiled from sources believed to be reliable; however, there is no guarantee of its accuracy or completeness. Any opinions expressed are statements of judgment on this date and are subject to certain risks and uncertainties which could cause actual results to differ materially from those currently anticipated or projected. Any future dividends, interest, yields and event dates listed may be subject to change. An investor cannot invest in an index, and its returns are not indicative of the performance of any specific investment. Past performance is not indicative of future results. The material provided in Daily Market Commentaries or on this website should be used for informational purposes only and in no way should be relied upon for financial advice. Please be sure to consult your own financial advisor when making decisions regarding your financial management. Members of FINRA and SIPC, Capitol Securities Management is a privately owned full-service retail brokerage and investment advisory firm headquartered in Richmond, Virginia. For nearly 30 years, we have been serving the needs of our investors. Today, more than 200 Capitol Securities Management investment professionals and support staff serve approximately 18,000 customer accounts from Southern Florida to the New England coast.
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