Monday Morning Musings
Stocks are mixed to lower this morning. There have been a few economic reports and a handful of earnings reports but nothing moved the market too much.
In economic news, pending home sales fell -5.6% in September after declining -1.6% the previous month. September industrial production rose better than expected +0.6%.
Earnings reports continue to roll in but not as many as last week. The big report tonight will be AAPL, although this quarter won't be a full quarter of new iPhone sales and won't include any of the new iPads.
Asian markets finished generally higher. Overnight SHIBOR rates continue to climb in China, with the 2-week rate up 53 basis points to 6.40%. Elsewhere, S. Korea's consumer confidence improved to 106 from 102.
Europe's markets are mostly lower. Trading is light in Britain due to very heavy storms there.
The dollar is higher today but not weighing on commodities. Oil prices are up a bit to $98.40 and gold prices are also higher today near $1355.
The 10-year yield is holding at 2.50%, a level it has been trying to hold for 4 days.
The VIX is bouncing from low levels, up 4% today to 13.60.
Trading comment: We said last week that the market had gotten very overbought, but that the most bullish action we might see would be for the market to merely consolidate sideways vs. succumbing to a larger selloff. So far that seems to be the course of things. The SPX continues to trade right at its highs. Lots of stocks still look extended, so we don't want to chase things here. But the strength of the market should be noted and 'buy the dips' remains a viable strategy.