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Morning Commentary

GETTING BACK ON SCRIPT

By Charles Payne, CEO & Principal Analyst
12/3/2021 6:17 AM

Well, yesterday was a good day. The rally held, but it lost some altitude with less than an hour to go as New York reported its highest single day of total Covid-19 cases since January at 11,300. This was right after it was revealed that a second U.S. Omicron case was a Minnesota man who recently visited the big convention center in NY City. Not surprisingly, later in the evening, NY reported five Omicron cases.

The 52-week lows continue to mount as new highs are moving close to single-digit counts.

Market Breadth

NYSE

NASDAQ

Advancing

2,520

2,994

Declining

870

1,650

52 Week High

17

31

52 Week Low

188

619

Up Volume

4.16B

3.47B

Down Volume

841.57M

1.80B

NASDAQ: Feast or Famine

With the spotlight on those mega-cap growth juggernauts, it has been lost how many stocks in the NASDAQ Composite have been completely wrecked. In fact, those names are an oasis in a desert of despair. But they can turn the corner quickly – meanwhile, the NASDAQ continues to straddle the 50-day moving average, and that’s good news.

Chart

Script Intact

Much has been made about how well this market has straddled seasonal patterns, but the script is in trouble if the S&P 500 doesn’t hold today to set up a big year-end move to begin next week.

Off-Script

The 10-and 2-year yield curve continues to flatten, and that could be the wildcard against all those predictions the Fed will be trying to slow inflation by slowing the economy. Heck, if the economy shifts to a recession, it’s doubtful Powell & Co. would be hiking rates.

Government Shutdown

Ironically, this is not a stock market story anymore, and it’s hardly a Washington, D.C. story. In a sense, it will end like it always does with the debt ceiling raised at some point. The market has rallied in recent years on shutdowns, perhaps because the government wasn’t spending the money it usually would, and the national debt clock would slow. By the way, congratulations are in order as our debt finally crossed above $29.0 trillion.

USA, USA, USA

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