Market Alert - Pre-Market

Futures vs FV: SP -5.97; DJ -69.19; NASDAQ +1.58

Futures are suffering something of a hangover after the strong stock move Friday pushed by big NASDAQ large cap earnings. A bit of a give back is quite normal.

The morning economic data did not change the futures trajectory much as spending surged in September on auto sales and utilities spending.

Personal Income, Sept: 0.4% vs 0.3% vs 0.2%

Personal Spending, Sept: 1.0% vs 0.8% exp vs 0.1% Aug. This is the largest gain since cash for clunkers. Nothing like a storm wiping out inventory to 'spur' spending.

Real spending (inflation adjusted): 0.6% vs -0.1% prior

PCE Core: 0.1% vs 0.1% prior. 1.3% year/year. 2% Fed target versus 1.3%.


AAPL: Rising again on reports that Phone X demand is running past AAPL's ability to supply the device. This is the opposite of reports out of Japan last week that AAPL was reducing component orders. No, as noted before, there were little 8 sales because the X was coming soon. AAPL thought it could sell anything because it was AAPL. People who would buy the 8 just decided to wait -- for a $1,000+ phone.


M&A: Vistra buying Dynegy. NVS buying Advanced Accelerator; Axalt buying Azko Nobel.


Russian investigation: Manafort, early Trump campaign manager, charged with tax fraud on foreign deals made with Russians among deals with people from other countries.


Fed: Trump purportedly to announce new Fed chair nomination Thursday.


OTHER MARKETS
Bonds: 2.39% vs 2.419%. 10 year rebounds after a drubbing last week.

EUR/USD: 1.1626 vs 1.1416.2

USD/JPY: 113.54 vs 113.586. Still at the 10 day EMA, testing the last move.

Oil: 54.02, +0.13. Still pushing on toward the top of the range.

Gold: 1277.90, +0.10


Futures are off the lows but are not trending higher. Gapped lower very early and trading in a range ever since. Slower earnings session today builds into a lot more earnings afterhours and the rest of the week.

Something of a normal test, nothing major. The key to watch is if this remains a muted fade, just digesting the Friday move some. If that is all this shows then the expectation would be the breakouts Friday were solid.



Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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