Morning Commentary
Yesterday, the stock market bounced around to every headline from Brexit to trade negotiations.
Those issues remain unresolved. The general feeling is there will be a resolution or steps that quill anxiety until there is a conclusion. On that note, Wall Street doesn’t care much about what the final resolutions are, and in fact, prefer business as usual.
Main Street US & UK want deals that are fairer for people, and not only reaffirm national sovereignty, but add a greater sense of military and economic security.
I keep saying, the main point, at the very least, is to make China do it under the cloak of darkness instead of in broad daylight. There are so many white-flag waving American commentators that believe China is invincible and can allow their economy to drift for one hundred years. But there are growing signs of economic stress that’s getting worse, including nonperforming loans at China’s banks.
Then there’s the question of household wealth and debt. Household debt in China is rising quickly. According to Credit Suisse, in one-year, China household debt surged 23% while US household debt only edged up 4.2%.
Global Household Economic Trends Sept 2017 to Sept 2018 |
Household Wealth |
Increase Total Household Debt |
Percentage Change |
United States |
$391,690 |
$677 billion |
+4.2% |
China |
$47,810 |
$942 billion |
+22.7% |
Europe |
$144,903 |
$782 billion |
+5.9% |
Asia |
$48,119 |
$578 billion |
+6.6% |
World |
$63,100 |
$3.1 trillion |
+7.15 |
It won’t happen overnight, but there will be a deal with China, and it will favor America.
Wild Ride
It was another wild session yesterday that saw the Dow Jones Industrial Average in an almost 500-point trading range. Chartist might like that reverse head and shoulders formation (there is the same formation on the three month chart of the Dow and S&P).
Although I think most would like to see a re-test of recent lows, (Dow 24,442 and S&P 2,641) I’m not convinced that must happen. But bias is to the downside, and selling triggers are exacerbated by the machines and algorithms.
Dow Jones Industrial Average
Where’s the Fed
Although Jay Powell didn’t completely walk back his October 3 bombshell, the Fed Chairman was confident and upbeat about the economy growing, and even gaining strength.
He acknowledged enough economic headwinds and vulnerable parts of the economy, including the housing market, which suggests the Fed understands this strong economy has its fragile areas that would become worse with aggressive rate hikes.
Fed Rate Hike Probability |
Current |
Week Ago |
Range |
Jan |
2.9% |
4.9% |
2.50 to 2.75 |
Mar |
42.8% |
53.8% |
|
May |
43.0% |
52.0% |
|
Jun |
42.0% |
42.0% |
|
Jul |
23.0% |
33.0% |
2.75 to 3.00 |
Sep |
27.3% |
35.0% |
Right now, a spat of earnings misses is pressuring the market. Nvidia (NVDA), which was vying to become one of the most important names in technology, laid an egg yesterday with a big earnings miss. I lost track on the number of downgrades this morning. The stock will open much lower and drag technology down as well.
High end retail is vulnerable with the miss from William Sonoma (NSM) and Nordstrom’s (JWM), but Shoe Carnival (SCVL) will soar today.
The Dow is looking down about 200 points in the premarket. I like yesterday's close. Let's see if there is any resolve.
Comments |
Charles, thank you for being the TRUTH telling news. So many sky is falling media, really seem to want China to Continue stealing USA IP. It's insane to sell out of futures for a profit today's qtr.. shareholders in USA,& CITIZENS, DIRTY FINGERNAILS JOBS, WILL PAY MORE FOR THINGS, OR JUST NOT BY CHEAP CHINESE GOODS, IF WE &PRESIDENT TRUMP CAN FINALLY REVERSE THE INVISERATION OF USA TECHNOLOGY &R&D. BE STRONG, CHINA IS FEELING THE PRESSURE,& NONE BELIEVE THEIR GDP NUMBERS ( STATE RUN BY GOVERNMENT PROPAGANDISTS.. WAYMO TO HAVE FIRST AUTONOMOUS VEHICLES CABS/VANS ON THE ROAD IN PHOENIX ARIZONA DECEMBER 2018, YES TRUCKS AUTONOMOUS VEHICLES ARE ALSO ON ROADS IN ARIZONA. SO Buy AI, NVDA, MSFT. APPLE, & BA. THE TAXPAYERS KNOW PRESIDENT TRUMP WILL GET IT DVT ONE WITH CHINA'S PRESIDENT XI JINPING. They are just trying to keep their cards close to chest, not act desperate like dems & some wall street people. Thank you president Trump. Thank you Charles PAYNE &FBN. LIFE IS GREAT, BE INVESTED LONG. J on 11/16/2018 10:02:40 AM |
Thank you some much J...
We are going to win. CP Charles Payne on 11/16/2018 10:04:06 AM |
Tweet |
4/26/2024 1:46 PM | Full Steam |
4/26/2024 9:39 AM | BIG TECH STEPS UP |
4/25/2024 1:16 PM | Don't' Bury me, Yet! |
4/25/2024 9:27 AM | THERE CAN ONLY BE ONE |
4/24/2024 1:30 PM | Earnings Flood In |
4/24/2024 9:26 AM | BUYING THE DIP |
4/23/2024 1:25 PM | Bloom Off Rose |
4/23/2024 9:32 AM | WHAT HAPPENED TO THE BRAVADO? |
4/22/2024 1:22 PM | Pins and Needles |
4/22/2024 9:30 AM | LIVE BY THE SWORD … |
4/19/2024 1:20 PM | Fair Chunk of Rotation |
4/19/2024 9:35 AM | DON’T OVERREACT |
4/18/2024 1:37 PM | Didn’t Break Down |
4/18/2024 9:40 AM | MARKET OFF SCRIPT |
4/17/2024 1:59 PM | Facing Pressure |
4/17/2024 9:37 AM | POWELL STILL WANTS TO HELP |
4/16/2024 1:35 PM | Muted |
4/16/2024 9:42 AM | FEAR ARRIVES |
4/15/2024 1:17 PM | Making a Statement |
4/15/2024 9:45 AM | Equal Opportunity Drubbing |
4/12/2024 1:37 PM | Pressure Overall |
4/12/2024 9:42 AM | WHO YA GONNA CALL? |
4/11/2024 1:38 PM | No Urgency |
4/11/2024 9:27 AM | Tough Sledding |
4/10/2024 1:22 PM | Hang In There |
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