It was another record day on Tuesday for the Trump Rally as the Dow smashed through 19,000 and all the other major equity indices surged to all-time highs.  A late surge made all the difference, and the momentum trade really worked as new highs dwarfed new lows on the New York Stock Exchange and NASDAQ.

Market Breadth	Advancers	Decliners	New Highs	New Lows
NYSE	65%	32%	236	14
NASDAQ	57%	37%	311	11

Once again, the scent of animal spirits is in the air and on display in housing and retail sales. In both cases, momentum was already in motion before the election. There is every reason to believe moves made by President-elect Trump could really put this rally into overdrive.

Consumer discretionary names led the way, riding a wave of earnings news and guidance.

Retailers Surge on Earnings

• (BURL) Burlington Coat Factory (it was my mother’s favorite store)
• (DLTR) Dollar Tree
• (DSW) DSW Inc.
• (CHS) Chico’s (yes, even Chico’s)

Today, we get the revision on consumer confidence from folks that have been polled or surveyed since the election.  I am looking for a monstrous improvement.  Remember the initial read from the University of Michigan; it was based on a survey from October 28 to November 8.  This update will extend the survey through November 20, making it one of the best early reads that include the presidential election.

Existing Homes

Sales of existing homes (the largest segment of the market) climbed to their highest level since Feb 2007, just ahead of the recent uptick in mortgage rates.

The breakdown of the report is intriguing as subprime ($100,000) homes saw sales at14.2%, while $100,000 to $250,000 homes were essentially unchanged; and yet, $1,000,000 homes surged 17.5%.  Overall, prices are just right, up year-over-year (for 56 straight months) but well below the $247,600 reached in June.  First-time homebuyers are showing up now - 33% of all buyers and homes are being snapped up quickly.

October Existing Home Sales By the Numbers	Month Ago	Year Ago
5,600,000 Annual Pace	+2.0%	+5.9%
4.3 Months’ supply	-2.3	-10.4
$232,200 Median Price	-1.3%	+6.0%
41 Days on Market	41	57

Potential Trump News

The volume will be thin today, but Donald Trump is in Florida with the family. With that being said, there is a big chance for more news on his cabinet.  

I think the market would love to hear the following names:

Mitt: Yes, I know a lot of folks are upset but the market wants him as Secretary of State.

• Retired Gen. James Mattis
• Former NYC Mayor Rudy Giuliani
• Dr. Ben Carson
• Gov. Nikki Haley

Today’s Session

Well, Nikki Haley has accepted President- Elect Trump’s offer to be the UN Ambassador.  Although I would rather be governor of South Carolina, this move helps bona-fide her for the White House down the road.  Meanwhile, it proves again that Trump can reach across to rivals, foes and critics.

This morning Durable Goods came in at 4.8%, more than 200% better than expected, and more signs of the economy bubbling up.

On that note, nondefense capital goods ex-aircraft climbed 0.4% again, signally big business is moving on long shelved projects.   The economic data is bolstered by earnings from Deere (DE), which blew away consensus. 

 

Comments

"Trump Rally"... I like it. For months, I've mentioned the "bubble", meaning N.Y., CA, Chicago, as the main "bubbles". Turns out I was right. Living in CA, I prepared some friends that Clinton would win. It was hard not to think that, watching the media churn out babble. The bubble was something I mentioned to you many times. First, I can gloat that I was right.... Those outside the bubble, saved our republic. And, also the capitalist system and the continuation of your company and those like it. This IS a Thanksgiving to be thankful for. I feel grateful that the bubble has burst, and it will be a good thing even for those living in it. Barry Gold on 11/23/2016 11:06:51 AM

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