MARKET REPORT
(Unburdened by what has been)
You were found in clear conditions. But you’re handsome in the Fog.
“Voters seem to forget when politicians ‘give’ you money, it is the voters’ money they have already taken.”
SUNNY HOSTIN “Would you have done something differently than President Biden during the past four years?”
KAMALA HARRIS “There is not a thing that comes to mind in terms of — and I’ve been a part of most of the decisions that have had impact.”
Day in Review:
Today:
(Kamalanomics: Govt-manipulated data with un-reported historic downward revisions to make the economy look more favorable):
DATA:
– NON-FARM PAYROLLS ACT 12k EXP 113k Prev 223k
– Rate 4.1% Exp 4.1%
– Excluding 40k Government jobs the ACTUAL NUMBER IS -28K!
– Previous months were revised sharply lower once again: August was revised down by 81,000, from +159,000 to +78,000, and September was revised down by 31,000, from +254,000 to +223,000. With these revisions, employment in August and September combined is 112,000 lower than previously reported. This means that even after the monster September revision when 818K jobs were removed, 7 of the past 9 months were again revised lower
– More government jobs were added in October than all private jobs lost in the month
– ISM Manufacturing PMI came below forecasts and pointed to another considerable contraction in the manufacturing sector in October, alongside rising price pressures.
– S&P Global reported its US Manufacturing PMI rose to 48.5 in October (still in contraction) from 47.3 in September
– ISM’s Manufacturing PMI was worse than expected, dropping from 47.2 to 46.5 in October – the lowest since June 2023
– Fourth straight month of contraction (sub-50) for the Manufacturing PMI
COMPANIES
– Super Micro continues its rout
– Amazon +6% on earnings beat
– The company posted earnings per share of $1.43 on revenue of $158.9 billion. Analysts had expected earnings per share of $1.16 on revenue of $157.29 billion.
– Amazon said it expects to spend $75 billion in capital expenditures in 2024 and Jassy (CEO) said the company plans to spend “more than that” in 2025.
– DJTWW down another 10% today
– APPL (-1.33%) Mixed report; EPS, revenue, and iPhone sales beat expectations, though service segment revenues were short, and its Q1 guidance was a little soft.
– Chevron (+2.87%) released earnings per share at 2.51 USD, compared to market expectations of 2.45
– Exxon Mobil (-1.52%) released earnings per share at 1.92 USD, compared to market expectations of 1.89
– Intel rallied 8% on stronger-than-anticipated revenue and an optimistic sales outlook
– Boeing gained 3.5% after a tentative union agreement
– Wendy’s (+2.88%) closes 140 restaurants (aim to relocate)
GENERAL:
– Euro Bourses close higher
– Nvidia to join DOW replaces Intel
– USDCAD increased to a 24-month high of 1.40. Over the past 4 weeks, US Dollar Canadian Dollar gained 3.27%, and in the last 12 months, it increased 1.54%
– USDMXN increased to a 25-month high of 20.23. Over the past 4 weeks, US Dollar Mexican Peso gained 4.06%, and in the last 12 months, it increased 15.4%
– UK natural gas futures fell toward the GBp 100 per therm mark, retreating from the over 10-month high of GBp 110 touched on October 25th and tracking the pullback in other major natural gas hubs amid the outlook of increased supply.
– Coffee decreased to a 7-week low of 242.75 USd/Lbs. Over the past 4 weeks, Coffee lost 5.06%, and in the last 12 months, it increased 47.15%
– Cut on-board next week
– Economists see a 100% chance of a 25-basis-point cut by the Fed next week, versus a 91% chance before the jobs data.
– Odds of a cut post Jobs
– President Trump has filed a $10 billion lawsuit against CBS news over its deceptive editing of Kamala Harris’ 60 Minutes interview.
– Trump trade tapered
– Nissan Cutting Production Of U.S. Models By 30%, Putting 2024 Global Sales Target At Risk
– Main stream Media deliberately, again distorts Cheney quote.
– ELECTION: FiveThirtyEight’s model assigns a 52% probability of a Trump win, and a 48% probability of Harris winning; pollster Nate Silver sees a 54% and 46% chance respectively. Republicans are clearly favoured to win the Senate, with FiveThirtyEight averages assigning an 89% probability, while the House is neck and neck, with Republicans seeing a 53% likelihood and Democrats 47%. On the night, the pivotal swing states (Arizona, Georgia, Michigan, Nevada, North Carolina, Pennsylvania, and Wisconsin) will be viewed to see how the election is playing out, with Pennsylvania seen as the key state, as it is likely, but not impossible, that a candidate will not win the election without it. In the polls and in recent weeks (via 538 and Nate Silver) PA has flipped to Trump.
– Equities up, Treasuries down, Crude up, Dollar up
Week ahead:
– US election, Fed, BoE, RBA, Norges, Riksbank, US ISM Services PMI and Canada jobs
Earnings:
– Earnings season continues with a deluge of reports, but a lack of heavyweights
MAJORS:
DX:
– The Dollar was firmer to end the week and saw a bid in the US afternoon, despite selling off after the US jobs report to hit a low of 103.67. Briefly recapping, the headline rose by just 12k (exp. 113k, prev. 223k)
BLS said that it is likely that payroll employment estimates in some industries were affected by the hurricanes, however, it is not possible to quantify the net effect. Elsewhere in the report, the unemployment rate was unchanged at 4.1%, as expected, while wages rose 0.4% M/M (exp. 0.3%) but Y/Y was in line at 4.0%. Nonetheless, the DXY quickly reared its head back above 104.00 and gained, thereafter to hit a high of 104.310 potentially on ‘Trump Trade’ ahead of the US election next week, as well as the FOMC on Thursday.
AUSSIE:
– there is significant risk ahead of the US election next week, whereby a Trump win would hit AUD on account of the former President’s views, and likely tariffs, on China.
POUND:
– GBP was the clear G10 outperformer on Friday, and was the only one to end the day in the green against the Buck. The Pound was able to pare some of the losses seen after two consecutive days of selling in wake of the budget. Ahead, aside from the risk events mentioned above, the BoE rate decision is next week whereby the bank is firmly anticipated to cut rates 25bps. Cable hit a peak of 1.2980 against an earlier trough of 1.2885.
EQUITIES
EUR:
– DAX +0.92% at 19,252, FTSE 100 +0.83% at 8,177, CAC 40 +0.80% at 7,409, Euro Stoxx 50 +1.04% at 4,878
US:
– SPX +0.41% at 5,729, NDX +0.72% at 20,003, DJIA +0.69% at 42,052, RUT +0.61% at 2,210
Sectors:
– Consumer Discretionary +2.40%, Technology +0.61%, Health +0.59%, Industrials +0.16%, Financials +0.11%, Communication Services -0.07%, Consumer Staples -0.07%, Materials -0.19%, Energy -0.74%, Real Estate -1.09%, Utilities -2.26%
OIL:
– WTI (Z4) SETTLED USD 0.23 HIGHER AT 69.49/BBL; BRENT (F5) SETTLED USD 0.29 HIGHER AT 73.10/BBL
The crude complex ended the day, and week, in the green due to heightened Middle East tensions but settled at lows amid Dollar strength. On Friday, WTI and Brent were buoyed and hit highs of USD 71.45/bbl and 74.94/bbl, respectively, as risk-premium returned into the weekend in wake of source reports on Thursday that Iran is preparing a major retaliatory strike from Iraq within days, and prior to the election. There were conflicting headlines regarding an Israel/Lebanon ceasefire, but the latest from Reuters sources suggested that US truce efforts on Lebanon failed ahead of the election.
Oil sold off from highs throughout the duration of the afternoon due to the Buck bid to settle at lows ahead of a week with key risk events such as the US Election (Tues) and FOMC (Thurs). For the record, the weekly Baker Hughes saw oil fall 1 to 479, nat gas rise 1 at 102, leaving the total unchanged at 585.
SUPPLY: Kazakhstan average daily oil output was down 20% in October vs. September, according to sources cited by Reuters, while Iraq total oil exports averaged 3.327mln BPD in October (prev. 3.31mln BPD M/M). Oil report courtesy of Newsquark.
GOLD/SILVER:
– Gold prices edged down on Friday, pressured by a stronger U.S. dollar and Treasury yields, but a weak job growth data from the world’s biggest economy prompted analysts to increase bets for a rate cut from the Federal Reserve, limiting some losses.
Spot gold fell 0.2% to $2,736.28 per ounce by 1:55 p.m. ET (1755 GMT). Prices fell 1.5% on Thursday as some traders took profit after bullion hit a record high of $2,790.15.
– Gold, a traditional hedge against economic and political uncertainty, tends to thrive in a low interest rate environment. Gold prices are typically influenced by the dollar and real yields. However, current high market interest in gold is partly driven by the upcoming elections, anticipated Fed rate cuts, and broader economic and geopolitical uncertainties, Standard Chartered said in a note.
BONDS:
– 2Y yield crashed 15bpas on the payrolls print… only to rip all back higher to close up 3bps on the day
YIELD CHANGE
US 1-MO: 4.645 -0.023
US 6-MO: 4.452 -0.015
US 1-YR: 4.284 +0.012
US 5-YR: 4.227 +0.072
US 10-YR: 4.386 +0.102
US 30-YR: 4.581 +0.106
TWO’s/TENS: 0.17 +0.06
CRYPTO
– Coinbase Global is on the move higher as shares rise by over 6% Friday morning. The cryptocurrency exchange reported third quarter results after Thursday’s closing bell, missing earnings and guidance estimates while turning a profit for the quarter.
– Stablecoin issuer Tether Thursday reported $2.5 billion of group-wide net profits in the third quarter of the year, bringing year-to-date profit to $7.7 billion as the market capitalization of its flagship cryptocurrency {{USDT}} neared $120 billion.
– Some $1.3 billion of the profits derived from yield on U.S. Treasury holdings, while another $1.1 billion was thanks to the unrealized appreciation of the company’s gold holdings in the reserve, Tether CEO Paolo Ardoino said in an X post. The price of gold was higher by about 15% during the third quarter.
KEEP DOING WHATS WORKING, STOP WHAT ISNT
Best of luck out there
Let the market come to you
Post of the day:
https://www.youtube.com/watch?v=NOVFh-zgCvY
https://www.youtube.com/shorts/uLXcWbMtx_g
Song of the day:
https://www.youtube.com/watch?v=sjO6Ff3xLpU
https://www.youtube.com/watch?v=f46ulX6uwGc
Joke of the Day:
https://www.youtube.com/watch?v=ce4fc1cQI2Q
(Seize all assets of Duke and Duke enterprises)
I can be contacted should anyone have any questions, input at [email protected] during US hours of EST 9am until 5pm
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