The same tide lifted all eleven sectors in the S&P 500, which still took on a cautious tone.

The bounce off 4,100 is encouraging, but the index is still locked into a series of lower lows and highs.

Market Breadth

Market breadth decidedly improved, save for new highs and new lows.

Market Breadth	NYSE	NASDAQ
Advancers	2,070	2,705
Decliners	835	1,602
New Highs	15	19
New Lows	119	303
Up Volume	2.90 billion	2.84 billion
Down Volume	1.31 billion	1.46 billion

Underscoring the fact the market has slumped for three straight months, and many stocks are oversold.  So despite three up sessions in a row, a paltry number of names are changing hands above their 200-day moving average.

I think this is a buy signal.

Slumping Into the New Year

 

History suggests the market could be poised for a year-end rally.  Ryan Dietrick posted this table (below) that shows a rally that averages 4.5% gains.

FOMO Decision

The dollar is too high, financial conditions are rapidly tightening, and rates are causing havoc.

Bonds in Focus

The ten-year yield is settling in the shadow of 5.0%, which is unnerving for the market.

 

More Data on Supply

The Treasury Department will detail which maturities will be used to raise $1.6 trillion in the third and fourth quarters.   Thus, it could move the markets more than the FOMC decision and Powell Q&A.

Rate Odds

The CME continues to model for no additional rate hikes and the first cut in June of 2024.

Today’s Session

Treasury announced its November refunding auctions, which came in slightly below the consensus of $114 billion, with one billion less in ten and thirty-year bonds.

November Refunding	Three Year	10 Year	30 Year
Estimate	$48 billion	$41 billion	$25 billion
Actual	$48 billion	$40 billion	$24 billion

Yields moved lower on the headline, but are still holding above key support of 4.80%, and below the ominous 5.0% resistance.

Now, we await Powell & Co.

Comments

I agree with that, Yellen's actions should be more in focus. It's not what the Fed-R will do or not do in the future, but on the Treasury Dept. in an attempt to CYA around funding a bloated gov spending at a higher rate. These are the same people who told us the inflation was transitory, until it wasn't... including her. Now they all only have a single emphasis around the economy being strong and able to support an ever-increasing debt. The combination of higher for longer and additional government questionable spending being dole out, is something they never mention as a potential cause. It's all about the strength of the economy, without attributing for just how much of it is being generated, at city and state levels to support their own misguided funding agendas. Don't think I need to point them out, but would like to know just how much of the GDP growth is associated with government support of those in the recent years, who have paid into the system? Terry Dowler on 11/1/2023 12:49:39 PM

Excellent financial explanations today! Tom Brukiewa on 11/1/2023 1:10:58 PM

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