Futures vs FV: SP +1.85; DJ +23.27; NASDAQ +2.15
The night before Brexit and all through the markets not much is stirring. Quite in Asia, quiet in Europe, US futures up just modestly.
Light news session thus far.
Yellen: meets with House Finance Committee at 10:00ET. Hopefully the House inquisitors are a bit more sharp in their questioning.
Oil: Over $50/bbl as API reports -5.2M bbl to inventory versus +1.1M the prior week.
Earnings: KBH and ADBE top but are down. FDX beat but notes just "moderate shipping growth." HPQ warns on its 2016 outlook.
The rest of the news is EDU/Brexit. Gold is off again and that suggests a calming of worries UK leaves. More polls lean toward stay. Why you would want to stay with an oppressive body that tells your citizens they cannot have electric tea pots because they use too much energy is crazy. Then again, the US has a government that bans 100W incandescent light bulbs, sticks a surcharge on tanning salons, taxes you just for standing and breathing the air . . . I think the West suffers from too much government, the exact thing the US was founded to avoid. Didn't work and that is why some sane voices are calling for constitutional conventions in the states, e.g. former senator Coburn. A symptom of 16 years of bigger and bigger government since 9-11.
But, I digress. The vote is overnight here in the US and coverage starts at 5:00ET on several financial stations. If the current situation does not force an exit (e.g. the insane immigration and open borders) then it will never happen as the English people would show they are converted to sheep. But again I digress.
OTHER MARKETS
Bonds: 1.71% versus 1.70% 10 year
EUR/USD: 1.1310 vs 1.1250
USD/JPY: 104.57 vs 104.856
Oil: 50.05, +0.20
Gold: 1268.00, -4.50
Futures are holding modest gains toward the open, holding the same range hit 4 hours back. May be that kind of day as traders get more neutral before the UK vote.
Again, there is not much upside in a 'stay' outcome. It may indeed cause stocks to pop initially, but for most of the market (outside of say oil stocks) nothing will have changed and thus it might be a good opportunity to bank some upside gains on software and others. Then perhaps some downside entries, but that depends upon if there is a reversal that sticks either that day or in the following days.
Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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