Futures vs FV: SP -9.4; DJ -87.33; NASDAQ -58.50
It's expiration and the chips are down. Chips, as light as they are, are weighing down stocks as NVDA and AMAT disappointed. Add to that the general mushy, sloppy, weak bid trade and you have a steady futures decline.
Futures have rebounded some the past 45 minutes, so there are some bidders out there.
Expiration Friday as well so there is some added volatility as a result.
Downgrades: NVDA, HD
Fed: Clarida, vice chair, says the Fed is close to neutral and it should now be data dependent.
WSJ: Agrees with Trump that Fed should reconsider a December hike. It notes that even though the Fed may be hesitant to not hike due to the appearance of being spineless, it has to do the correct thing for the economy. I would add to that, gee, the President got it right and you did not. Admit your mistake, don't be POLITICAL YOURSELF, and do what you think you are supposed to do, damn your mandate (as it has for 100 years).
Oil: S Arabia cutting shipments to US to try to increase prices.
Autos: Earlier this week it was Germany's GDP showing a big drop in autos. Now that has spread to most if not all the world.
Industrial Prod, Oct: 0.1 vs 0.3 exp vs 0.2 prior (from 0.3)
Capacity Utilization: 78.4 vs 78.2 vs 78.5 prior (from 78.1). Quite the revision.
Bonds: 3.094% vs 3.116%. Some flight to safety on the earnings, comments re rate hikes from WSJ, others.
EUR/USD: 1.1393 vs 1.13305. Some euro bid.
USD/JPY: 112.83 vs 113.585. Dollar loses some bid here as well.
Oil: 57.71, +1.25
Gold: 1223.90, +8.90
Again, stocks cannot play with a lead. After a bounce Thursday that looked somewhat better in a couple of indices, they are ready to open with a significant downside. Friday, expiration, questions about economics, trade, the Fed -- the usual. We will see how this plays out as some bids did return pre-market. Whether that is an expiration move or not we will see, but that is the point: today is clouded by other factors.
Jon Johnson, Chief Market Strategist
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