Confidence – the state of feeling certain about the truth….a feeling of self-assurance.
…..And confidence is everything when it comes to the markets. On Tuesday morning – we found out that US consumer confidence hit a 7 year high and BOOOOOM - it was off to the races – (again). Americans are also feeling better (if not wealthier) with the turnaround in mkts as well as the bonanza of a windfall due to falling gasoline prices – especially right around the holidays. The consumer confidence index blew the roof of the house at 94.5 (consensus was 87) which is the highest read since October 2007.
So here's my question.....Do you think that the massive jump in consumer confidence reported yesterday is driven (or being manipulated) by next week's elections? I mean look - if you just go out and talk to the man on the street and ask them how it's going or how our elected officials are doing or how good they feel about the future - my sense is that you will find that so many people are frustrated and upset with the current state of affairs.....but yet - somehow - these supposed same Americans reported that their view of the economy is the HIGHEST it has been since October 2007!
This good news prompted our friend Lynn Franco - Director of Economic Indicators at the Conference Board to gush with
excitement as she exclaimed -
"With the holiday season around the corner, this boost in confidence should be a welcome sign for retailers."
Considering that there are only 57 more shopping days til Christmas - we better get moving! I mean you can already see the retailers lining up to extend hours and begin announcing pre-sales - yeah...those are the sales before the sales...which I am sure will become all the rage this season.....for those 'special customers'....
As a result - ALL of the indexes performed beautifully….with the S&P, DOW, Nasdaq and Russell all closing above their 50 dma’s - the Russell leaping nearly 3% in a sure sign that 'risk aversion and anxiety' is subsiding.
While US housing prices did show a 5.6% ‘annualized’ gain – they did fall by 0.15% in August...... but the fact that the FED is due to announce policy today led so many to believe that the prospect of low rates will continue for longer than we originally thought – and low rates for another 12 months will continue to support housing and can only mean that equities will move higher….
While the US indexes have failed to make new highs I am becoming more confident that the October ‘correction’ will prove to be the bottom in the weakness that began back in September. The snapback has been dramatic (and now maybe even a bit overdone) but it does look like investors/traders are putting the concerns behind them. This even as the FED is set to announce the end of QE at 2 pm today. Have global investors suddenly woken up to the fact that the global economy is not on the verge of implosion? 3rd Q earnings have not disappointed for the most part and the world did not end when oil broke $80/barrel.
But just to keep the door open and the FED in a dovish mood - the conference board did announce that Durable Goods orders for September fell by 1.3% after the 18.3% plunge in August. This weakness will allow the FED to keep rates lower for longer. In addition - look for what the policy statement says about inflation.....expectations are that the FED will continue to express their concern - re-inserting their language that 'low inflation poses a risk to economic performance' - 3 outspoken FED Presidents - Dudley, Evans and Kocherlakota have all been banging the drum that below target inflation will prevent the FED from prematurely raising interest rates.....and the BUY PROGRAMS kick in....
So it looks like the all clear signal has sounded and the Christmas rally is building strength……That being said – next year could prove to be different – especially when they actually start to try and normalize rates…..but that's a conversation for another day…right now – it’s clear sailing ahead as we closed well above 1975 resistance and are now gearing up to challenge 2000 and then the all time high….
Currently US futures are down 3 pts....as they take a breath. The big event is the FED - the only eco stat is mortgage apps and those declined by 6.6%. Look for action to be muted until the FED decision gets leaked.....I suspect the mkt holds right here at the 1970 level.
(After the bell last night Face Book projected 4th q sales to fall short of predictions while spending will increase between 50-70% as the company grows. The combo of slowing growth and increasing costs caused a selloff in post mkt trading....the stock is currently down 6 pts or 8% - rallying back a bit from the original beating of 11% immediately after the announcement.)
So – what’s going on across the pond in Europe? Did you see what Sweden did? Yes – Sweden….you know that little country bordered by Norway to the west and Finland to the east and Denmark to the south….
They – like the UK are part of the European Union – and like the UK – did not adopt the Euro as their currency. They continue to maintain the Krona as their form of currency – and as such – they still have their own central bank – who CUT rates from 0.25% to ZERO% yesterday because of falling inflation. Now what is interesting about this is that Sweden had RAISED rates to 2% by the end of 2011 – causing their economy to choke..so they then began to cut again and again and again…..to jumpstart their economy and now they are at ZERO….…….so – will this serve as a warning to the UK, the US and the Eurozone on the need to maintain low rates until you are sure that the economy can withstand it? And it is in fact those ultra low rates that will continue to feed the beast (the bull) as he stampedes higher and higher.
Currently FTSE +0.62%, CAC 40 + 0.14%, DAX +0.66%,
EUROSTOXX +0.08%, SPAIN -0.38% and ITALY -0.36%.
Switching to Asia - all you have to do is look at the newest member of the NYSE - Alibaba! BABA (which many now consider a proxy for China) surged higher yesterday - surpassing the mkt cap of Walmart for a brief minute as the stock pierced $100/sh - a 46% increase over its IPO debut 2 months ago.
That goes hand in hand with how the Chinese mkt has performed. Tuesday it surged by 2% and last night it rallied another 1.5% - bringing its ytd performance to + 12.1% - so far taking the crown in this year's beauty contest. It seems that investors are focused more on the increasingly positive economic outlook for China and expect to see more stimulus and more reforms that will drive their economy and their mkt. After falling nearly 45%, during the 2009/2013 time frame – it appears that investors and the Chinese public are now being drawn back in. Is Chanos still short that country?
Overnight - Japan +1.46%, Hong Kong +1.27%, China +1.5% and ASX -0.09%.
And we come to the end of another ERA - Tuesday night - here in NYC at the Beacon Theater - The Allman Brothers Band bid farewell to their fans......ending their decades long career as the country's classic Southern Rock Band. For those of you who missed the last 45 yrs.....well - You missed it.
You get the little pumpkins – you know the ones – take them home – slice off the tops – discard the seeds- save the tops. – place a dab of butter in the center and then place in a roasting pan with the lids on. Drizzle with oil and roast in a 400 degree oven until they soften some – but do not collapse – maybe 35/40 mins.
Remove and let cool. Once cooled using a spoon scrape the ‘flesh’ away from the outer skin….careful not to pierce. Place in a bowl to use in the risotto.
Now make the Pumpkin/Butternut Squash Risotto –
You will need: Chicken Broth, Arborio rice, Butternut squash, 1 1/2 cups of pumpkin puree (not the pie filling that you buy in the store - you need real pumpkin puree), large diced onion, chopped fresh basil, plenty of fresh grated Parmegiana Cheese, olive oil - and the kicker - 3 tblspn of Mascarpone Cheese. -
Preheat the oven to 400 degrees.
In a baking dish - combine the rice, cut up butternut squash, the pumpkin puree, diced onion and the chicken broth. Season it with a bit of s&p and mix well. Cover it tightly with a lid or with tin foil and place in the middle rack in the oven. Re-visit it in 10 mins intervals and stir. It will be done when most of the broth has been absorbed and the rice is no longer hard. This should not cook any longer than 40 mins max.
Remove from the oven and add - the Parmegiana, the Mascarpone and the chopped basil and the flesh from the pumpkins. Mix well. Now fill each pumpkin with the risotto so that it is overflowing a bit, place the lid back on and set in a large serving platter for the presentation. It’s a great way to brighten you dining room table and your guests will love it.
Buon Appetito.
…..And confidence is everything when it comes to the markets. On Tuesday morning – we found out that US consumer confidence hit a 7 year high and BOOOOOM - it was off to the races – (again). Americans are also feeling better (if not wealthier) with the turnaround in mkts as well as the bonanza of a windfall due to falling gasoline prices – especially right around the holidays. The consumer confidence index blew the roof of the house at 94.5 (consensus was 87) which is the highest read since October 2007.
So here's my question.....Do you think that the massive jump in consumer confidence reported yesterday is driven (or being manipulated) by next week's elections? I mean look - if you just go out and talk to the man on the street and ask them how it's going or how our elected officials are doing or how good they feel about the future - my sense is that you will find that so many people are frustrated and upset with the current state of affairs.....but yet - somehow - these supposed same Americans reported that their view of the economy is the HIGHEST it has been since October 2007!
This good news prompted our friend Lynn Franco - Director of Economic Indicators at the Conference Board to gush with
excitement as she exclaimed -
"With the holiday season around the corner, this boost in confidence should be a welcome sign for retailers."
Considering that there are only 57 more shopping days til Christmas - we better get moving! I mean you can already see the retailers lining up to extend hours and begin announcing pre-sales - yeah...those are the sales before the sales...which I am sure will become all the rage this season.....for those 'special customers'....
As a result - ALL of the indexes performed beautifully….with the S&P, DOW, Nasdaq and Russell all closing above their 50 dma’s - the Russell leaping nearly 3% in a sure sign that 'risk aversion and anxiety' is subsiding.
While US housing prices did show a 5.6% ‘annualized’ gain – they did fall by 0.15% in August...... but the fact that the FED is due to announce policy today led so many to believe that the prospect of low rates will continue for longer than we originally thought – and low rates for another 12 months will continue to support housing and can only mean that equities will move higher….
While the US indexes have failed to make new highs I am becoming more confident that the October ‘correction’ will prove to be the bottom in the weakness that began back in September. The snapback has been dramatic (and now maybe even a bit overdone) but it does look like investors/traders are putting the concerns behind them. This even as the FED is set to announce the end of QE at 2 pm today. Have global investors suddenly woken up to the fact that the global economy is not on the verge of implosion? 3rd Q earnings have not disappointed for the most part and the world did not end when oil broke $80/barrel.
But just to keep the door open and the FED in a dovish mood - the conference board did announce that Durable Goods orders for September fell by 1.3% after the 18.3% plunge in August. This weakness will allow the FED to keep rates lower for longer. In addition - look for what the policy statement says about inflation.....expectations are that the FED will continue to express their concern - re-inserting their language that 'low inflation poses a risk to economic performance' - 3 outspoken FED Presidents - Dudley, Evans and Kocherlakota have all been banging the drum that below target inflation will prevent the FED from prematurely raising interest rates.....and the BUY PROGRAMS kick in....
So it looks like the all clear signal has sounded and the Christmas rally is building strength……That being said – next year could prove to be different – especially when they actually start to try and normalize rates…..but that's a conversation for another day…right now – it’s clear sailing ahead as we closed well above 1975 resistance and are now gearing up to challenge 2000 and then the all time high….
Currently US futures are down 3 pts....as they take a breath. The big event is the FED - the only eco stat is mortgage apps and those declined by 6.6%. Look for action to be muted until the FED decision gets leaked.....I suspect the mkt holds right here at the 1970 level.
(After the bell last night Face Book projected 4th q sales to fall short of predictions while spending will increase between 50-70% as the company grows. The combo of slowing growth and increasing costs caused a selloff in post mkt trading....the stock is currently down 6 pts or 8% - rallying back a bit from the original beating of 11% immediately after the announcement.)
So – what’s going on across the pond in Europe? Did you see what Sweden did? Yes – Sweden….you know that little country bordered by Norway to the west and Finland to the east and Denmark to the south….
They – like the UK are part of the European Union – and like the UK – did not adopt the Euro as their currency. They continue to maintain the Krona as their form of currency – and as such – they still have their own central bank – who CUT rates from 0.25% to ZERO% yesterday because of falling inflation. Now what is interesting about this is that Sweden had RAISED rates to 2% by the end of 2011 – causing their economy to choke..so they then began to cut again and again and again…..to jumpstart their economy and now they are at ZERO….…….so – will this serve as a warning to the UK, the US and the Eurozone on the need to maintain low rates until you are sure that the economy can withstand it? And it is in fact those ultra low rates that will continue to feed the beast (the bull) as he stampedes higher and higher.
Currently FTSE +0.62%, CAC 40 + 0.14%, DAX +0.66%,
EUROSTOXX +0.08%, SPAIN -0.38% and ITALY -0.36%.
Switching to Asia - all you have to do is look at the newest member of the NYSE - Alibaba! BABA (which many now consider a proxy for China) surged higher yesterday - surpassing the mkt cap of Walmart for a brief minute as the stock pierced $100/sh - a 46% increase over its IPO debut 2 months ago.
That goes hand in hand with how the Chinese mkt has performed. Tuesday it surged by 2% and last night it rallied another 1.5% - bringing its ytd performance to + 12.1% - so far taking the crown in this year's beauty contest. It seems that investors are focused more on the increasingly positive economic outlook for China and expect to see more stimulus and more reforms that will drive their economy and their mkt. After falling nearly 45%, during the 2009/2013 time frame – it appears that investors and the Chinese public are now being drawn back in. Is Chanos still short that country?
Overnight - Japan +1.46%, Hong Kong +1.27%, China +1.5% and ASX -0.09%.
And we come to the end of another ERA - Tuesday night - here in NYC at the Beacon Theater - The Allman Brothers Band bid farewell to their fans......ending their decades long career as the country's classic Southern Rock Band. For those of you who missed the last 45 yrs.....well - You missed it.
Stuffed Baby Pumpkins
Ok – so get this….what a great dish for the holiday that is only 4 weeks away. Use the pumpkins to stuff with the Butternut/Pumpkin Risotto.You get the little pumpkins – you know the ones – take them home – slice off the tops – discard the seeds- save the tops. – place a dab of butter in the center and then place in a roasting pan with the lids on. Drizzle with oil and roast in a 400 degree oven until they soften some – but do not collapse – maybe 35/40 mins.
Remove and let cool. Once cooled using a spoon scrape the ‘flesh’ away from the outer skin….careful not to pierce. Place in a bowl to use in the risotto.
Now make the Pumpkin/Butternut Squash Risotto –
You will need: Chicken Broth, Arborio rice, Butternut squash, 1 1/2 cups of pumpkin puree (not the pie filling that you buy in the store - you need real pumpkin puree), large diced onion, chopped fresh basil, plenty of fresh grated Parmegiana Cheese, olive oil - and the kicker - 3 tblspn of Mascarpone Cheese. -
Preheat the oven to 400 degrees.
In a baking dish - combine the rice, cut up butternut squash, the pumpkin puree, diced onion and the chicken broth. Season it with a bit of s&p and mix well. Cover it tightly with a lid or with tin foil and place in the middle rack in the oven. Re-visit it in 10 mins intervals and stir. It will be done when most of the broth has been absorbed and the rice is no longer hard. This should not cook any longer than 40 mins max.
Remove from the oven and add - the Parmegiana, the Mascarpone and the chopped basil and the flesh from the pumpkins. Mix well. Now fill each pumpkin with the risotto so that it is overflowing a bit, place the lid back on and set in a large serving platter for the presentation. It’s a great way to brighten you dining room table and your guests will love it.
Buon Appetito.
Recommended Content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.