Market Alert - Pre-Market

Futures vs FV: SP -1.33; DJ -5.32; NASDAQ +2.38

Futures are well off the lows from 2 hours back, rallying nicely into GDP. A better than expected GDP report, however, did not lead to immediate higher prices as futures faded some gains. They are now bouncing around below the flat line for the NYSE, but the bids are still coming in better.

Okay, that means futures are down a bit, very similar to Thursday. That likely means the areas that have performed better continue in the same vein.


GDP Q4 final: 2.1% vs 2.0% exp vs 1.9% previous read.

The change? Consumer spending revised to 3.5% from 3.04%, with foreign travel and leisure accounting for the jump. Okay then.

CNBC web headline claims the consumer "powered" Q4 GDP more than expected. Powered? This is the 'dumbing down' of the expectations for what is strong, average, weak. For the past 9 years we have been told that mediocre to weak data is 'strong' and 'great' data. Powered to a 2.1% gain? Give me a break.


Fed: Williams (San Fran) was on Fox Business talking economy. Blah, blah, blah. The notable sentence: the US corporate tax system is out of date.


Brokerage/Asset Management: LM laying off 3% of staff due to 'disruption' in the money management industry. BAC is downsizing its Merrill Lynch unit to 6 divisions from 10.


Putin: When asked about hacking the US election he paraphrased Bush I, saying 'watch my lips,' that Russia did not hack. He attributed the phrase to Reagan. More Russian propaganda! He is trying to change history! Damn those Russians and Putin particularly.


OTHER MARKETS
Bonds 2.389% vs 2.382% 10 year. Flat at the top of the range.

EUR/USD: 1.0724 vs 1.0766. Dollar recovering some.

USD/JPY: 111.334 vs 111.021

Oil: 49.79, +0.28

Gold: 1251.50, -5.30


Futures are showing an ebb higher toward the open as bids are actually pushing into the open, and that is more momentum than we have seen to this point.

As noted last night, SP500 and DJ30 made their initial moves off the 50 day MA. Will they continue?

Further, will NASDAQ push past the prior highs? Will RUTX, SP400 break through near resistance? Will bonds break higher through the range? Will gold clear 200 day MA? We will be watching, and it looks as if bids are better so TLT, gold will have trouble making those moves. We will see.


Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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