25 Oct 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%.