Daily Comments

Asian markets were mixed. The Nikkei 225 rose +0.50% as the Shanghai Composite fell -1.19%.. European markets were mixed. The DAX edged down by -0.08%. 10-yr Bunds yield -0.574. The MBA Mortgage Applications Index rose on purchases and refinancing. For 11/20, Initial Claims rose to 778K, EIA crude inventories were -0.754M. The Baker-Hughes US oil rig count is 320, up 10. Q3 GDP was unrevised at +33.1%, a record pace, and as expected. Oct. Durable Goods Orders were up +1.3% (ex-transportation +1.3%), the International Trade in Goods deficit widened to -$80.3B, Retail Inventories(a) were up +0.8% and Wholesale Inventories(a) rose +0.9%, Personal Income fell-0.7%, Personal Consumption Expenditures rose +0.5%, the PCE Price Index was unchanged, and New Home Sales were 999K. Final Nov. Consumer Sentiment slipped to 76.9. FOMC Minutes for 11/5 noted no immediate change to the composition or pace of asset purchases. 10-Year Notes yield 0.886%. The Dec. US$ Index slid -0.28% to 91.960. Dec. gold gained +0.01% to $1,804.60. Jan. crude jumped by +2.05% to $45.82. In light, pre-Thanksgiving holiday trading volume, the ES was choppy, edging lower.

The Trump Administration authorized the start of the official transition process for President-Elect Biden and Biden announced former Fed Chair Yellen as his choice for Treasury Secretary. Asian markets were mostly higher. The Nikkei 225 jumped +2.50% but the Shanghai Composite fell back -0.34%.. European markets all gained. The DAX jumped +1.24%. 10-yr Bunds yield -0.560. The September Case-Shiller Home Price Index showed prices up +6.0% YoY, the fastest annual increase in over 2 years. The FHFA House Price Index printed at 1.7% MoM vs. 1.5% expected, with YoY at 9.1% YoY vs. 8.0% consensus. November Consumer Confidence dipped slightly to 96.1 vs. 98 estimated, and Oct. was revised higher to 101.4. 10-Year Notes yield 0.885%. The Dec. US$ Index was off -0.42% at 92.110. Dec. gold gained lost -1.81% to $1,804.60. Jan. crude jumped +1.51% to $43.06. After yesterday’s announcement that Yellen is the choice for the next Treasury Sec., stocks began to rally. The strength continued today, with gains across the board and a new RTY high. The DJIA is on pace for its best Nov. since 1928.

Singapore’s economy fell -5.8% for Q3, pointing to a decline of more than -6% for the full year, although growth is expected again in 2021. Asian markets were higher. The Shanghai Composite rose another +1.09%. The Nikkei 225 was closed for a holiday. European markets were softer. The DAX edged down by -0.08%. 10-yr Bunds yield -0.577. The November Markit PMI Composite Index beat expectations at 57.9, with manufacturing rising to 56.7 and services up to 57.7. 10-Year Notes yield 0.857%. The Dec. US$ Index gained +0.14% at 92.525. Dec. gold sank -2.05% to $1,834.00. Jan. crude was up +1.13% to $42.90. According to today’s headlines, there is now a cumulative total of 12M covid-19 cases in the U.S. Vaccines however, seem to be imminent. AstraZeneca of the UK announced their covid-19 vaccine candidate in late-stage trials can be 90% effective. The public, and perhaps the markets, are uncertain as to when further stimulus measures will get passed by Congress. The CARES act’s Pandemic Unemployment Asst. expires on Dec. 31. The ES traded firmly higher overnight, faded to unchanged midday, then rallied to close strong. The RTY closed at an ATH.