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Afternoon Note

Modestly Lower

By Charles Payne, CEO & Principal Analyst
11/6/2019 1:56 PM

The markets have given up earlier gains and now all the major indices are in the red, albeit modestly.  The Nasdaq is the worst performer, down about .51%, while the Dow and S&P500 are off about .17%.

There are reports that the meeting between President Trump and Chinese President Xi Jinping to sign the proposed interim “Phase One” trade deal may not take place until December.  This has made investor edgy. The terms of the deal and the venue for the meeting are still being discussed according to Reuters, and a deal is more likely than not as per “a senior official of the Trump Administration.” 

On the economic front, the weekly MBA Mortgage Applications Index was down 0.1% after being up 0.6% in the previous week, as rates ticked up.  "U.S. Treasury yields once again exhibited some intraweek volatility before declining sharply toward the end of the week. As a result, mortgage rates decreased, with the 30-year fixed rate falling below 4 percent again," said Joel Kan, Associate Vice President of Economic and Industry Forecasting

Speaking of interest rates, there were more comments that the Fed maybe on hold with any further rate cuts.   At a Wall Street Journal event, New York Fed President John Williams said, "The three rate cuts we did were very effective at managing the risks" to the economy from the uncertainty around the trade dispute and global growth slow down. 

Consumer Staples and Healthcare (good earnings from CVS and HUM) are today’s leaders, while Energy is a big loser.  The EIA inventory report showed a build of 7.9 million barrels. This makes it 6 of 7 weeks with a build in crude.  As a result, WTI crude is down 1.61% to $56.31.

S&P 500 Index



Communication Services (XLC)



Consumer Discretionary (XLY)



Consumer Staples (XLP)



Energy (XLE)



Financials (XLF)



Health Care (XLV)



Industrials (XLI)



Materials (XLB)



Real Estate (XLRE)



Technology (XLK)



Utilities (XLU)





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