It’s a compelling session that might be the ultimate example of stocks climbing the so-called wall of worry.  In addition to all the high profiled headlines and issues facing the nation, an early warning of the potential shutdown of LaGuardia airport in New York did not slow down the rally (airline stocks are even trading higher). 

Heading into the afternoon, however, the market is showing signs of concern.  Off the highs of the session, there is a groundswell of wonder over what comments might come from the White House Rose Garden this afternoon.  I think the news will be a short-term deal to reopen government for two to three weeks.

That news would be welcomed by investors, although three more weeks of grandstanding does not guarantee Washington, D.C. will get its act together.  The fact is, ever since congress decided a short –term fix would suffice, we have been edging toward peril.   Kicking the can down the road using continuing resolutions has been nothing short of a disaster, allowing for complete abdication of responsibility to governor.

Meanwhile, investors are focused on a so-called barbell approach of buying value (see materials) and momentum (see communication services).

Market Calm

Although the news cycle has been a whirlwind, and the headlines breathless speak of the collapse of the republic, Wall Street has become less anxious.

The so-called fear index continues to ease and is nearing a key support point where a dip below takes the read to the level it was when major indices were hitting all-time highs last October.

VIX