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SPX 2079. INDU 17664. COMPQ 5054. RUT 1162. DAX 10850. CAC
4898. FTSE 6361. MIB 22443. IBEX 10361. PSI 5469. NIKK 19083. SPASX200 5239.
KOSPI 2029. SSEC 3383. HSI 22640. BSE 26657. Happy Halloween; All Saints Day. Pray for the
faithfully departed; pray for the world. A Russian passenger plane [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology] not move
with a hike until February 2016 or later.
Daylight Saving Time change occurs in the
United States overnight tonight so the five-hour time difference with the East
Coast and London stock exchanges and six-hours between Central Europe will be
back in place next week.
The ASX 200 trades down -0.6% to begin global trading for
Friday. Aussie dollar 0.7081. The Nikkei Index futures point to a slightly higher
open. Dollar/yen 120.99.
Japan jobless rate is 3.4% in line with the 3.4% expected.
Japan national CPI is down -0.1% better than the -0.2% expected. Ex food and
energy CPI is up +0.9% versus the +0.9% expected and above last month’s +0.8%.
The data is [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology] electronic communications via
computers, laptops, smartphones and other electronics are monitored, recorded
and archived by the US government. The only way that a private conversation can
take place in this modern world is if the discussion takes place face-to-face
with all electronic gadgets especially cell phones at least three feet (1
meter) away. George Orwell’s “Big Brother” government, described in his book,
Asian indexes are mixed a couple hours into trading. The
NIKK is down, KOSPI up and ASX 200 down -0.5%. Chinese stocks are trading
marginally higher. US futures are negative. S&P -4. Dow -36. Nasdaq -10.
Euro 1.0924. Dollar/yen 120.74. Pound 1.5265. Aussie dollar 0.7109. Dollar/yuan
WTIC oil 45.82. Brent oil 48.92. Natty gas 2.30. Gold 1162.
Silver 15.96. Copper is down -0.4% to 2.352.
US Treasury yields are [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology]
HRL recalls 153 cases of Skippy peanut butter
jars due to potential metal shavings contamination. A Boeing 767 catches fire
as it taxis for takeoff in Florida. Over 100 passengers are evacuated with 15
people injured one in serious condition. BA stock does not react in the afterhours.
Asian trading is
underway with the SPASX200 marginally lower, the NIKK up +0.4% and the
KOSPI down -0.4%. Japan retail sales are [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology] television sponsors a debate for
the republican candidates for POTUS in Boulder, Colorado. The network is
criticized for its “gotcha” questions designed to encourage arguments to
increase television ratings rather than promoting substantive dialogue. Young Marco Rubio
wins the debate and will receive higher poll numbers.
Australia stocks are trading flat to lower to kick off
Tuesday’s global trading. Aussie dollar 0.7244. New Zealand stocks begin
trading after the holiday playing catch-up with the main index gaining +0.4%.
Nikkei Index futures point to a +0.5% open. US futures are flat. S&P +1.
Dow +8. Nasdaq +3.
Treasury yields are; 2-year 0.64%, 5-year 1.39%, 10-year
2.06%, 30-year 2.87%. German bund 0.502%. Japan 10-year yield 0.313%.
Asian indexes are negative a couple hours into trading. The
global stock rally created by the Fed, ECB and PBOC central banker collusion is [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology] teen demographic
preference in social media is Instagram as the top platform, then TWTR, then
Snapchat then FB. Facebook does not care that it is the fourth preference by
teens since it owns Instagram the current favorite of the teeny-bopper
The five-year China planning meeting is [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology] a United States destroyer
plans to sail within 12 miles of the disputed Spratley Islands in the South China
Sea. China has constructed a large military base and landing strip on the
islands. Several Asian nations claim ownership to the islands. Tensions ratchet
higher between the US and China in the South China Sea. China wants to limit
aircraft and ships in the area. The United States is rattling its saber as the
Chinese leaders continue meeting to develop their five-year plan.
The Beijing communists meet to [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology]
In the States, rains and flooding hit Texas as
the remnants from Hurricane Patricia travel across northern Mexico and the south-central
US. Business and commerce will be hampered in the Lone Star State for the next
week. Authorities are assessing crop damage.
Euro 1.1017. Dollar/yen 121.45. In one day’s time the
dollar/yen pair ran from under 120.40 to 121.45 over one full point. The USD
catapulted from under 95 late last week to above 97 after the ECB’s dovishness
sent the [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology] only
100 days until the first primary votes are cast in Iowa when the race becomes
very serious. The countdown begins.
On the Fox business block of television shows,
the bullish recommendations continue. Gary B Smith says AMZN will be up over
+50% within two years. John Layfield says oil giant CVX will be up +20% within
the next year. Jonas Max Ferris says LULU will rise +25% over the next year.
Charles Payne suggests buying WHR. Adam Lashinsky suggests buying VO. Ben Stein
and Elizabeth McDonald continue to suggest buying dividend ETF’s and funds proclaiming
SDY and LCEIX, respectively, as winners going forward. SDY is back to flat on
the year after losing -10% during the August selloff. MSGN is another
recommendation. The future is so bright that you have to wear shades.
Euro 1.1101. The euro prints a 1.10 handle a short time ago
and drops from 1.14 in only a couple days time due to ECB President Draghi’s
dovish monetary policy. Dollar/yen 120.70. Pound 1.5391. Thailand markets are [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology] Hurricane Patricia begins hitting the Mexican west coast. Heavy rains will
ripple through Texas creating floods. Boom. The CAT 5 storm hits landfall at
7:08 PM EST with winds as high as 220 MPH (354 KPH). Mexicans and tourists
brace for the worst.
At 8:15 AM Tokyo (7:15 AM Hong Kong and Shanghai; 7:15 PM
EST Wednesday evening in the States), US futures are flat. S&P +2. Dow -3.
Euro 1.1341. Dollar/yen 119.90. Pound 1.5418. Aussie dollar
0.7212. WTIC oil 45.28. Brent oil 47.85. Natty gas 2.41. Gold 1167. Silver
15.69. Copper 2.3585.
US Treasury yields are; 2-year 0.62%, 5-year 1.35%, 10-year
2.02%, 30-year 2.86%. The 2-10 spread is 140 bips threatening a 139 handle
which represents a flattening yield curve. German bund 0.569%. Japan 10-year
Weak commodity and mining stocks create a [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology]
In Iraq, A US soldier is killed during a raid against ISIS
Islamist radicals that frees 70 prisoners many are Iraqi soldiers believed to
be in imminent danger. The United States suffers the first combat death in Iraq
in four years. President Obama’s war against ISIS sheds American blood.
US Treasury yields are; 2-year 0.633%, 5-year 1.39%, 10-year
2.069%, 30-year 2.914%. German bund 0.636%. Japan 10-year yield 0.325%.
At 8:35 AM Tokyo (7:35 PM EST Tuesday evening in the
States), US futures are flat. Euro 1.1352. Dollar/yen 119.82. Pound 1.5446. USD
94.913. WTIC oil 45.93. Brent oil 48.71.
The SPASX200 is trading down -0.5% to kick off Wednesday
trading. Aussie miners are beginning the day [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology] US and Allies are requesting action by the
UN to address Iran’s testing of intercontinental ballistic missiles. The ink is
barely dry on the Iran nuclear agreement and the radical Islamists are testing
missiles that can be fitted with nuclear warheads.
The ASX 200 is down -0.3% to begin Tuesday trading with oil
and energy stocks creating a drag. Nikkei futures indicate a robust upside open
in excess of +1%. United Continental names Brett J Hart as acting CEO for the
airline after Oscar Munoz remains in the hospital following a heart attack. UAL
is down -0.3% in late [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology] packaging king
PKG misses on the top and bottom lines. Cardboard, containerboard and
corrugated packaging products are a key bellwether since a robust and dynamic
economy requires shipping of products, parts, contracts and raw materials. Soft
cardboard and packaging materials sales indicate a soft economy.
FedEx and United Parcel Service stocks have been
in a downtrend since the May top in markets. The UPS 20/50-week MA cross is a
valuable indicator of whether the stock market is in a cyclical bull or bear
pattern. The UPS 20-week MA is under the 50-week MA signaling an ongoing cyclical bear
market for stocks, however, UPS price has recovered lately and the 20-week may cross back above the 50 in the weeks ahead.
Global traders are fixated on China GDP to begin the new
week of trading. The potential reaction to the data is an unknown. If China
growth drops under +7%, which will clearly verify the weakening economy, will
the Shanghai and Hang Seng Index’s instead catapult higher anticipating more PBOC stimulus (bad news is
China GDP is expected to come in at +6.8%, a six-handle,
versus the +7.0% from Q2. The central bankers have created a cynical market. If
one were a betting man, and knowing that China massages their economic data
even more than the US, the GDP will likely come in at +6.9%, under the +7%
level to reflect the slowing economy that everyone realizes, while at the same
time beating consensus at +6.8% and meeting the top end of the +6.4%-+6.9%
consensus range. A +6.9% GDP would be the Goldilocks number if the Beijing
communists pick the most favorable outcome to try and stabilize markets.
As Monday morning begins in Tokyo and Hong Kong, and Sunday
evening continues in the States, futures are flat. S&P -1. Dow -7. Nasdaq
+1. The ASX 200 begins trading flat. The Nikkei futures are indicating a soft open
down about -0.5%.
Euro 1.1353. Dollar/yen 119.39. Pound 1.5437. Aussie dollar
0.7264. Mexican peso 16.4054. Canadian dollar is 1.2916 with Canada elections
on tap today. Dollar/yuan 6.3538.
WTIC oil 47.47. Brent oil 50.68. Natty gas is up +1.1% to
2.46. Gold 1176. Silver 16.00. Copper 2.4060.
US Treasury yields are; 2-year 0.61%, 5-year 1.35%, 10-year
2.03%, 30-year 2.88%. The 2-10 spread is 142 bips.
At 9:30 AM Tokyo (8:30 AM Shanghai and Hong Kong; 8:30 PM
EST Sunday evening), S&P -3. Dow -25. Nasdaq -6. The KOSPI is trading
marginally lower along with the NIKK and ASX 200. US Treasury yields drop one
basis point across the yield curve; 10-year yield 2.02%.
South Korea retail sales are [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology]
For Q3 earnings season so far, over 70% of companies have
beat on the bottom line EPS, however, less than 50% have beaten on top line
China President Xi and his wife land in London
and the communist is given the red carpet treatment. UK PM Cameron says a “Golden
Era” of Chinese-Britain relations begins. Western nations line up one after
another to kiss the communist’s ring.
Sauidi bombing raids in Yemen targeting the radical Houthi
rebels accidentally kill 20 pro-government fighters and wound [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology]
AMZN stock remains on fire at record highs at 571, however,
weekly and monthly charts are negatively diverging suggesting that Amazon is
about to make an epic multi-year top probably before year end. The party at
Amazon is likely ending and 2016 may be a year of reckoning for CEO Jeff Bezos
if the charts play out as indicated.
US Treasury yields are; 2-year 0.613%, 5-year 1.35%, 10-year
2.035%, 30-year 2.88%. German bund 0.549%. Japan 10-year yield 0.32%.
Violence intensifies in Israel. Palestinian knife attackers
are [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology] the last flight that takes place under the US Airways
banner. US Air and American Airlines, AAL, merged in 2013. All fights will fly
under the American Airlines banner here forward. Frequent traveler miles programs
have been merged. The 1939 flight number was chosen since it was the first year
that US Airways was formed (76 years ago). US Air had its main hub in
Pittsburgh, Pennsylvania, for decades; the airline began as All American Aviation
then Allegheny Airlines then US Air.
After a couple hours of trading in Australia and Asia, the
ASX 200 is up +1%, the NIKK is up +1.4% and KOSPI prints marginal gains. The
cascading global rally continues as traders expect the Fed, BOJ, PBOC and ECB
to keep goosing stock markets higher with easy money.
S&P futures -1. Dow +3. Nasdaq +1. Euro 1.1367.
Dollar/yen 119.18. Pound 1.5463. Aussie dollar 0.7304. Dollar/yuan 6.3490. USD
The US dollar index prints a death cross chart pattern
(50-day MA down through the 200-day MA) yesterday and conversely the euro is in
a golden cross pattern (50 above the 200). The patterns suggest that [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology]
The US Interior Department, under the cover of
Friday night darkness, announces plans to cancel all future lease sales in the
Arctic and sections of Alaska and will not renew current leases. President
Obama clearly does not want to see the oil companies pursue offshore drilling
activities in the Arctic.
The SPASX200 begins trading marginally higher. BOK (Bank of
Korea) and BI (Bank of Indonesia) are providing rate decisions today.
US futures are higher and gaining upside on the Jon
Hilsenrath article in the WSJ that concludes that the Fed will wait until 2016
to hike rates. Hilsenrath is considered to have the inside track on Fed
thinking so traders are bidding up the stock and futures markets since easy
money will continue for the next few months. S&P +4. Dow +17. Nasdaq +31.
Euro 1.1477. ECB President Draghi has to be losing sleep
over the higher euro. Dollar/yen 118.71 under the 119 level. Pound 1.5475. Aussie
dollar 0.7320. USD 93.98.
US Treasury yields are; 2-year 0.56%, 5-year 1.28%, 10-year 1.98%,
30-year 2.84%. The 2-10 spread is 142 bips. German bund 0.546%. Japan 10-year
The NIKK is up +0.8% in the early going. The KOSPI gains
+0.8% and Aussie stocks build on earlier gains. ASX 200 +0.5%. Euro 1.1467.
Dollar/yen 119.07. WTIC oil 46.43. Gold 1184. US 10-year yield 1.99%.
Chinese and Hong Kong indexes begin the session moving
higher and Asia stocks develop an optimistic tone. The weak data in China and
the US hints that the PBOC will have to provide more stimulus. Bad news is good
news and the central banker easy money will pump stock markets higher. China
says money supply has [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology]
Fed’s Mester, a hawk, continues to state the case for a rate
hike. Market participants, however, have already written off a hike until 2016
and this is evidenced by the robust global stock market rally the last couple
days. She says delaying the first rate hike may create risks to the economy and
markets. Mester’s hawkish comments fall on deaf ears.
Notable market technician Louise Yamada says stock market
rallies should be sold going forward. Market leaders are underperforming during
the recent relief rally. Yamada says evidence is mounting that a long term top
is in place and other indicators are on a classic sell signal. Yamada is a very
talented technician but failed to warn of the market top resulting in a -10% to
-60% initial haircut in stocks.
The Keystone Speculator is the only Wall Street
analyst that accurately described the market top forming this year using chart
divergence techniques. Loyal followers of the KE Stone family of blogs and this
daily chronology were fully prepared and ready for the rollover. Keystone
warned of the market top during the spring and summer since the monthly charts
for the major indexes have printed negative divergence with overbot conditions
and rising wedge patterns. This is a key piece of evidence that easily foretold
the top in the stock market.
Australia stocks begin the session lower. Ditto the other Asian
indexes. China September CPI (Consumer Price Index) is up +1.6% year-on-year
less than the +1.8% expected and below the prior month’s +2%. China PPI
(Producer Price Index) is down -5.9% exactly in line with the estimates and the
prior month. The PPI is negative every month for nearly four years. Deflation
risks linger in China.
A couple of hours into Asia trading, as the democrat debates
finish in the States on Tuesday evening, the ASX 200 is down -0.6%. KOSPI off
-0.8% and NIKK down -1.7%. The Nikkei Index is under 18K. Komatsu bulldozes
itself -4% lower. Nikon loses more than -5% on slumping camera sales. Japanese
car makers trade higher.
In China, the SSEC is down marginally -0.2% and in Hong
Kong, the HSI loses -0.7%. Singapore GDP is better than expected so the economy
narrowly avoids recession. The Singapore central bank eases monetary policy but [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology] Netflix is on a
conference call. XLNX jumps +3.1% after beating by a penny on EPS and guiding
higher. Tesla announces an auto-pilot feature for its cars which is met with
yawns. TSLA +0.2%.
Treasury Secretary Lew says the United States will run out
of money in early November unless Congress raises the debt ceiling limit. The
heat in the Washington, DC, kitchen is only getting hotter.
WSJ journalist Jon Hilsenrath releases an article titled,
“Fed Doubts Grow on 2015 Rate Hike.” The article is important since Hilsenrath
is considered by many market participants as a mouthpiece of the Fed.
Hilsenrath always appears to have insight into the Federal Reserve’s thinking
that others do not. Hilsenrath cites weak economic data and activity likely
pushing the first rate hike into 2016 therefore the party begins.
Hilsenrath has signaled the all-clear. US
futures are buoyant and rising. Asia and Europe trading should be positive. The
easy money will continue well into 2016 so traders will buy stocks tomorrow.
The central bankers are the market. The Fed saves the day!
Asian indexes begin trading mixed with the ASX down -0.2%
and New Zealand stocks are up +0.5% extending a couple-day rally. Aussie dollar
0.7359. Dollar/yen 120.02. Nikkei Index futures point to a lower open for the
NIKK after yesterday’s holiday. US futures are flat. S&P -1. Dow -2. Nasdaq
-3. Global traders are focused on the imminent China trade data.
Euro 1.1357. Dollar/yen 120.03. Pound 1.5342. Aussie dollar
0.7360. Dollar/yuan 6.3235. WTIC oil 47.60. Brent oil 49.86. Natural gas 2.54.
Gold 1163. Silver 15.82. Copper 2.4130.
The US bond market will be trading today after the Columbus
holiday yesterday. Treasury yields are; 2-year 0.64%, 5-year 1.40%, 10-year
2.09%, 30-year 2.92%. The 2-10 spread is 145 basis points. The 5-30 spread is
152 basis points.
China Import and Export data is disappointing. Imports
plummet -20.4% last month year-on-year versus the -15% expected and below the
prior month’s -13.8% decrease. China Exports drop -3.7% better than the -6.3%
expected and the prior month’s -5.5% but economic weakness persists. The China
trade surplus is [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology]
US futures are negative as Asia prepares for a new week of
trading ahead. S&P -4. Dow -32. Nasdaq -9. Australia stocks begin the week
marginally higher. The Aussie dollar is at 0.7321 a seven-week high. New Zealand stocks trade up +0.7%. Japan is
not trading today due to the Sports (Health and Sports) Day holiday.
Treasury yields are; 2-year 0.64%, 5-year 1.40%, 10-year
2.09%, 30-year 2.92%. Bond markets are closed due to the Columbus Day holiday. German
10-year yield 0.612%. German 2-year yield -0.26%. Japan 10-year yield 0.332%.
China Golden Week spending data is very [Text is Redacted: Purchase October 2015-10 to Read the Complete Chronology] drop in oil prices is the big story today. WTIC is down
over -4% to 47.44. West Texas crude was testing the 200-day MA resistance at 51
one day ago. Brent oil is beaten down to 50.70 from above 54.00 only one day
ago. Energy stocks are slapped hard. XLE -1.3%.
After the closing bell, Fed’s Brainard warns about the
slowing global economy and its potential negative impact on the United States.
She advises colleagues to watch the economic data. Brainard is concerned about
the lack of wage growth (since inflation that the Fed desires cannot exist
without higher wages). She expects inflation to remain subdued. Brainard had
been leaning hawkish over the last few weeks but is clearly more dovish in her
statements and speech. Brainard does not rule out a rate hike this year but her
comments state the case for the Federal Reserve to delay the first hike until
The Federal Reserve continues to send mixed messages one
member stating the case for a rate hike and another does not. The constant Fed
speak only serves to create confusion and angst among global traders. It
appears more and more that the Fed is simply making it all up as they go along.
Traders and investors are losing confidence in the central banker Keynesian
money printers that are controlling the world’s markets and economies for the
last six years.
S&P rating agency downgrades Volkswagen
credit rating one notch to A-. S&P blames the emissions scandal for the
lower rating and says further cuts may be warranted. VW may have to sell assets
to build cash reserves.