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Morning Commentary

Economy Is Coming Together

By Charles Payne, CEO & Principal Analyst
10/4/2017 9:13 AM
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Lots of signs from across the economic spectrum are showing an uptick in the economy that clearly reflects that groundswell of optimism manifesting into reality. We’ve seen it this week in homebuilder Lennar and in manufacturing data.

Market Breadth NYSE NASD
Advancers 1,617 1,602
Decliners 1,246 1,332
New Highs 314 375
New Lows 13 24


September auto sales came in significantly better than expected.  In fact, according to Auto Data, the pace of annualized sales in September was 18.57 million, which was more than one million above Wall Street consensus.

September Auto Sales




General Motors








Fiat Chrysler

















Sure, there was a bump in demand from areas hit by hurricanes Harvey and Irma.

Lost vehicles:

But replacing cars lost to floods is only a small part of the story.  (In the real world, people are still waiting for insurance companies to cough up checks to actually go out and buy replacement rides.) 

-GM Chevrolet sales +12%

-Ford F-Series +21.4% as prices increased $2,300 from a year ago

-Toyota Rav4 +44%

-Nissan Rogue +47%

-Chrysler Jeep sales finally cooling off (must be why they offered me to come in early on my lease) -4%

The same experts that were so off on estimates for sales last month warn that this pop will be short-lived.  I’m inclined to believe they are too pessimistic.  However, average incentives edged up to $4,048 per vehicle, an all-time record. 

I think that speaks to cars because SUVs, hybrids and pick up truckers are flying off the lot.

Beginning to feel a lot like Christmas

Today, the National Retail Federation said a “longer shopping season and strong consumer confidence will deliver retailers a strong holiday season.”

Even though less it is less than prior years, retail sales demand is expected to generate lots of jobs.

You’ll never hear this in the mainstream media, but our economy is coming together, and you should be less concerned about the overdue correction and focus on a long term strategy to ride this renewal. 

Today’s Session

Equity futures have been under pressure all morning long and got a little weaker after the release of ADP September Employment report.

The headline of 135,000 is slightly less than the 140,000 expected, as overall results are mixed and probably skewed by the hurricanes. 

The big letdown came from small businesses, which lost jobs.  For all the talk of tax reform and benefits to big businesses capable of investing and hiring, it’s the small businesses that need the most relief.  Moreover, in the right environment, it is small business that will hire the most workers.

Dirty Fingernails

My favorite trend, which I continue to point out as evidence of a return to the roots of American greatness, is in goods producing jobs or what I affectionately like to call ‘dirty fingernail jobs.’

Goods Producing 48,000

Let the market open and trade and hopefully see enough pressure to tempt weaker hands.  


Yesterday afternoon [on Cavuto], there was a tremendous amount of criticism on President Trump's "speech" in San Juan ... he was in the PRANG Puerto Rico Air National Guard hangar by the end of the runway at the airline airport in San Juan. They were sitting around a bunch of card tables; no teleprompter; and it was very impromptu.

President Trump praised his "staff" ... the disaster people from FEMA and others ... 43 days non stop ... the military and others for their getting in there early with the previous hurricane Irma and also with Maria.

I personally thought it was appropriate, because he was criticized for doing nothing, when in fact, they were working hard and getting results. [AND, the mayor of San Juan declined or did not attend any of the FEMA coordinating meetings].

So, I am defending President Trump ... if he does not mention the good things that we are doing, ... then WHO WILL mention them.

Best regards,

- Al M.
President Trump also said the death toll was only a tiny fraction of that which took place in New Orleans.

Al M. on 10/4/2017 10:23:44 AM
I get it the mainstream media doesn't like President Trump. Honest criticism is good, too, sadly its rare these days. CP

Charles Payne on 10/4/2017 10:33:08 AM
Charles: Even though you speak of the continuing positive attitude of the market and be sure not to miss this opportunity, could you address the benefit of the slow steady increases (e.g. daily DOW increases <1%) as opposed to a major strong one day increase >3% or 4%?
Thank you

Joe Keefer on 10/4/2017 5:00:02 PM

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