Although the market closed lower, you have to look at the internals and see the session was rougher than major equity indices would suggest.  Losers outpaced winners two to one on the New York Stock Exchange and were 50% more on the NASDAQ Composite.   Overall volume was light but skewed negative. 

Market Breadth	NYSE	NASDAQ
Advancing	998	1,377
Declining	2,048	2,062
52 Week High	100	152
52 Week Low	17	20
Up Volume	935.58M	1.64B
Down Volume	2.78B	1.92B

The session wasn’t a disaster, especially on the heels of big moves made this month.  There just was never any leadership, as Communication Services was the lone winning sector on the S&P 500.

S&P 500 Index		-0.63%
Communication Services XLC	+0.10%
Consumer Discretionary XLY		-0.02%
Consumer Staples XLP		-0.08%
Energy XLE		-1.55%
Financials XLF		-1.92%
Health Care XLV		-0.76%
Industrials XLI		-1.11%
Materials XLB		-0.89%
Real Estate XLRE		-1.70%
Technology XLK		-0.64%
Utilities XLU		-0.69%

Hotline Model Portfolio Approach

This morning, we are adding to Industrials in our Hotline Model Portfolio.

Today’s Session

Bank earnings have largely been a yawner again, save for Goldman Sachs (GS), which posted results that are hard to ignore.

Bank Earnings

Goldman Sachs (GS)

• Revenue $10.7 billion consensus $9.4 billion
• Earnings $9.68 consensus $5.50

PNC Bank (PNC)

• Revenue $4.48 billion consensus $4.01 billion
• Earnings $3.39 consensus $2.11

Wells Fargo (WFC)

• Revenue $18.86 billion consensus $17.87 billion
• Earnings $0.42 consensus $0.48

Bank of America (BAC)

• Revenue $20.3 billion consensus $20.88 billion
• Earnings $0.51 consensus $0.50

CPI informs investing

September Consumer Prices increased 0.2% from August resulting in the lowest read in four months.  I wrote last month in the commentary, and more detailed in Payne’s Perspective, of how investors should use this report to discover investing ideas as much as a gauge on inflation.

The biggest increase came in used cars and trucks, and on the other end of the spectrum, we were struck by the sharp decline in prices for appliances.

 

 

Comments

Thank you Charles I like reading you commentary Edward Fischer on 10/14/2020 11:24:48 AM

Charles, what do you think of the 1.3% COLA that the government is giving to the seniors this coming year? William Brown on 10/14/2020 1:47:07 PM

I would say its a drop in the bucket but they have gotten a lot less in the past.  The CPI for this is an antiquated way to determine such payments.  Long overdue for overhaul.  CP Charles Payne on 10/14/2020 1:49:49 PM

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