Question of the Week

It was billed as the political event of a lifetime so the big question follows: who won the U.S. Presidential Debate at Hofstra University?

Donald Trump
Hillary Clinton
The American People
No one

Much has been made about the stock market and the outcome of this presidential election. While there are distinct policy differences that should result in economic backdrops that would impact the stock market differently, there are also unknowns that are impossible to predict. 

Firstly, it goes without saying the pro-business policies of Donald Trump should result in better top-and bottom-line growth, ultimately to propel stocks higher.  The wildcard is a trade war or vendettas for companies that move operations outside the United States. 

Meanwhile, Wall Street and Big Business are putting their money behind Hillary Clinton.  No executive from the top 100 companies in America has made financial donations to the Trump effort.  With profits near all-time highs, they probably care more about global trade than lower U.S. taxes.

There are some recent signals from the stock market that one could conclude point to a Trump win in November.  A sell-off in solar stocks has become an avalanche as Donald Trump has caught up to his rival.

 

Then there’s the Mexican Peso, which is at its lowest level ever versus the U.S. dollar.  Like solar, this isn’t a recent development, it has become much more pronounced as Trump’s numbers have soared.   The big conundrum is that it doesn’t make a trade war easier, and Mexico is looking great as a vacation destination. 

 

Yesterday’s Session and the Rings of Hell

It’s a part of riding out markets; in hindsight, it’s always explained with a degree of calmness, but it confirms previous resistance points as new support points. From a technical point of view, this is what’s been occurring for the stock market since July – it’s the inability to gain traction, but it’s also the inability to breakout.  According to Dante, the state of limbo was the first circle of hell, an inferior form of heaven but not the real thing. 

These days, investors so despise sideways markets or even occasional pullbacks since it feels more like the ninth circle of Dante’s hell – treachery.    

This kind of angst makes lulls more excruciating. And yet, mass panic has been avoided because even the most frightened investors have probably held through several periods of weakness. They understand why it’s better to grin-and-bear it rather than blink and regret even later.  The reality is that the market is a rudderless ship for now. 

The ride is bumpy; while not treacherous by any means, it’s rocky enough.

 

Housing Stays Strong 

Even with new home sales declining by more than 7%, the actual pace was better than expected and a 20% improvement from a year earlier.  It’s clear that momentum is strong, but supply is not keeping up with demand, which makes for choppy month-to-month tallies.

Long term View

Median home prices declined for the second consecutive month to $284,000 last month. Back in June, median prices hit $320,700 - a number that was clearly overheated. The market knows that housing is a sole bright spot. There are no coattails for continued good news. 

Today’s Session

Equity futures were significantly higher a few hours ago but have slipped in part to news that the OPEC meeting in Algeria is coming up short.  There are whispers of a plan to cut output by 1,000,000 barrels a day, which includes an Iranian freeze, and Saudi Arabia cutting back 400,000 barrels a day taking the Middle Kingdom back to January levels. 

Meanwhile, Deutsche Bank (DB) continues to be problematic, and the longer it lingers, the wider the anxiety grows for banks in general. 

Comments

Trump did alright but was on the defensive somewhat... HE was effective at some points, yet missed huge opportunities regarding the Clinton Foundation and more on emails. Would have been great response when she attacked his business background. Reagan lost the first to Mondale and came back strong. I think he will learn from this and look forward to the next one where I believe he will paste her. She deserves it since the press won't do it's job and is basically in the bag for her. Ray Weldon on 9/27/2016 9:45:08 AM

I am so tired of hearing about a trade war under Trump. His tax and regulatory policies will fix things he will not need to do what the pundits think he will do. Drop corporate rate and on repatriated dollars and clean up the regulatory morass and we will be off to the races. Ray Weldon on 9/27/2016 9:47:46 AM

WE must remember that Trump is not a professional politician or debater. That said he absolutely held his own and in my opinion came across as prepared to lead the country. She wants to keep doing the same old thing. Keep doing the same and you will get the same results Terry on 9/27/2016 10:32:23 AM

I am just sick of Politian's as a whole. At least he is not one. vote them all out and four years later vote all of them out, if necessary four years later vote them out.Then maybe we start to change things for our grandchildren for the better. term limits for a do nothing congress would help. dwayne on 9/27/2016 10:34:02 AM

Why were the questions about Hillary's emails, Benghazi and The Clinton Foundation not ask by Lester Holt? It appears to me that Holt is a support of Clinton. Paul Zatyko on 9/27/2016 10:38:27 AM

The one good thing about the debate was having 5 of my closest friends over for a debate watch and dinner party. Trump got a few zingers in hostile territory, but should have hammered her on Bengazi, Clinton Foundation and emails more. Charles, tell Trump that the next time you talk to him. Daria Schooler (DoctorObvious) on 9/27/2016 11:13:42 AM

Frank Luntz's group gave it to Hillary 16 to 6 right after the debate. Not a good sign, but not necessarily decisive. This showing should give his team the leverage to make him go on the offensive. Trump side: His lack of preparation was pretty obvious. Maybe he'll listen to his team before the next one. Sean Hannity should be the guy to train him on counter-attacking. He was too defensive. He should have had a short list of things he could use as counterattacks. As a result he failed to knock her back on her heels when she attacked. Big minus. His facial expressions while she was talking were often contemptuous. The proper look is attentive. Unquestionably, Lester Holt was biased. The Clinton folks did a good job of reaching him before the debate. He asked Trump twice as many negative questions as he asked her, and completely ignored the big ones -- like Isis, the emails, Benghazi, the Iran deal, the Clinton Foundation, and her lousy record on women and Blacks. In addition, there must have been something wrong with Trump's mike that made him sound like he was snorting in places where a speaker would not even be taking a normal breath. All of this is enough to call the debate rigged. But that's not much help for Trump. In short, the really big issues got lost in the shuffle. A big "U" for unsatisfactory for the debate. Hillary side: She was obviously well-prepared, probably even obviously over-prepared, Her animosity toward Trump was obvious. The questions favored her. Her constant big tooth smile never seemed genuine.. She often smiled at all the wrong places. Designing the stage so that he didn't look any bigger that she did was another finger on the scale for her. The only shots that even hinted at relative size (6'4" vs 5'6") were from the back. On Balance: A clear negative for Trump, but survivable. The debate will be grist for his rallies from here on out. Could be a plus. People love outsiders, but they love underdogs even more. He needs a new outcry from the crowd: "Give 'em hell, Donald!" And then launch into his counterattacks. His model should be the U.S. Marines on Guadalcanal. They came back from hell and won. For the really big issue in this election, go to: bitly.com/1fnWg2r Dennis Howard on 9/27/2016 11:21:03 AM

Trump might have overdone the restraint, but HC had no accomplishments, other than her air travel miles, so no great impact. Patricia Flynn on 9/27/2016 11:22:37 AM

I am a democrat, a liberal and a devoted Hilary supporter. We. must have watched different debates last night. She cleaned his clock. I think you guys saw the Emperors New Clothes. He is a LOSER !!! Harold Sader on 9/27/2016 1:29:24 PM

Clinton,Holt,B.H.O. & DNC have more deceitful spin than a iranian centrifuge. P.S. heard that on G. Beck. Frank on 9/27/2016 4:20:00 PM

The question is: Will Trump take some of the constuctive criticism or will his big ego not let him? Rodman Johnson on 9/27/2016 4:58:39 PM

No one won gil on 9/27/2016 5:15:17 PM

HE CHOKED AND THEN DECLARED HIMSELF THE WINNER. WOW!w Harold Saderw on 9/27/2016 8:22:39 PM

Trump had so many chances to really hit her with the truth, her e-mails the destroying the evidence after being investigated , Health care and everything from being First Lady attacking her husbands girl friends and making up stories about absolutely everything. And more important stop talking about himself and he does not need to answer or defend himself. Stick to the issues and no matter what or who asks just ignore there questions Sheila Bixsen on 9/27/2016 10:45:41 PM

The lost opportunities Trump failed to take gave Clinton an advantage (hopefully temporary). Trump can win over voters if they know the truth about Clinton. Shirley on 9/28/2016 3:59:15 PM

I was hoping for Lester Holt to be above the Frey, and be unbiased in the debate and he proved me right about him once again! This is why I don't watch NBC news for the past 2 years he's a pussy and can't conduct a debate without the Liberal Media bosses telling him you do as we say or you'll be looking for a new job! Just another UNCLE TOM! Doing what the white folks tell him to do! He certainly learned what can happen, look at Brian Williams, if he wasn't stupid as he was this hack Lester Holt would have NEVER got the position he has now! I hope that someone goes up to him and throat chops him so that he losses his voice! Spineless black bastard! Brian Cartwright on 9/28/2016 6:55:48 PM

I was hoping for Lester Holt to be above the Frey, and be unbiased in the debate and he proved me right about him once again! This is why I don't watch NBC news for the past 2 years he's a pussy and can't conduct a debate without the Liberal Media bosses telling him you do as we say or you'll be looking for a new job! Just another UNCLE TOM! Doing what the white folks tell him to do! He certainly learned what can happen, look at Brian Williams, if he wasn't stupid as he was this hack Lester Holt would have NEVER got the position he has now! I hope that someone goes up to him and throat chops him so that he losses his voice! Spineless black bastard! Brian Cartwright on 9/28/2016 6:55:50 PM

Trump better start boning up and stop talking so much for a while. Meat Loaf Jr. aka Chris Wallace is a Rino and is going to be no better a debate moderator than the last guy was. It's over. Chris on 9/28/2016 7:08:34 PM

Hillary won the debate but Trump won the argument. America has serious problems that must be addressed. Albert Sanchez on 9/29/2016 2:33:18 AM

Hello Uncle Tom Uncle Tom on 9/30/2016 3:56:10 AM

Hillary is such an obvious fraud who will say anything to get elected for her donors. Trump just can't seem to keep his mouth shut. He has great ideas, but cannot seem to verbally express in a presidential way. R G Cowart on 10/1/2016 9:55:08 AM

Sane Americans know Hilary Clinton will be terrible for America and our sovereignty! Trump is the answer right now! Clinton is a proven failure! Anthony Sewell on 10/1/2016 10:00:56 AM

Most people don't use their brains but four more years of Obama is the last thing this country needs. Leon Vickerman on 10/4/2016 2:22:03 PM

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