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It looked like THE BIGGEST WEEK EVER was going to start off with a nice rally. Nope. We started up, then went down sharply, and ended up barely.But first, the scoreboard:
S&P 500: +1
And now, the top stories:
- The huge story overnight was the blistering growth in the Chinese PMI, and the attendant surge in Shanghai stocks. The Shanghai composite had been weak the last few days, and this marked a sharp reversal to the upside.
- In Europe the big story if the return of the PIIGS! Actually, they’ve been back in the news for a while, but things are really starting to deteriorate, especially in Ireland, where yields are now above 7%. Some ominous words from a well-known Irish economist about how everything could collapse on December 7 is what really set things in motion today.
- Heading into the early action things were generally looking higher.
- At 8:30 AM Personal Income and spending came in worse than expected, though there was little movement in markets.
- Then at 10:00 AM we got a very strong October ISM reading. That was our first look into Q4 GDP, and so that’s a good sign (though interestingly some of the internal anecdotes weren’t so hot, as manufacturers fretted about wild currency fluctuations). We also got a decent construction number at the same time, and markets seemed to be in solid rally mode.
- But as the day wore on, stocks reversed course. In the afternoon stocks went negative. News that the SEC was looking into JPMorgan over a deal similar to Goldman’s abacus clearly hit financial stocks.
- Today felt pretty busy and volatile and yet it was just a warm-up for the week, which really starts on Tuesday. Tomorrow we have the huge election, and the dominant thinking is that if the Republicans fail to win big, it will be bad for stocks. Here’s a guide to all of the odds and the key questions.
- And of course, that’s just the beginning. Click here to see why this is a week that will change American history.
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