Equities are hovering around last July levels as the markets have become spooked by the specter of higher interest and the possibility of a Trump presidency as a ABC/Washington Post poll showed that Trump with 46% of the vote compared to Clinton’s 45%.
The fear factor is rising in so many dimensions.
Commenting about interest rates, the two day Fed meeting concludes today. No change is expected but all believe the narrative will suggest an increase in rates is all but done in December given the data.
Speaking of which, the ISM Manufacturing Index was nominally higher than expected suggesting that growth in this sector is consistent to a stronger fourth quarter. The 51.9 reading was nominally higher than the 51 averaged thus far this year and the 51.3 measured in 2015. The prices paid component rose to a three month high of 54.5 from 53 thus igniting some concern that inflation may be stirring.
What can I write about the election?? Life is indeed stranger than fiction but will again opine for as ugly and visceral as democracy may be, it beats any alternative.
Last night the foreign markets were down. London was down 0.32%, Paris down 0.58% and Frankfurt down 0.69%. China was down 0.63%, Japan down 1.76% and Hang Sang down 1.45%.
The Dow should open little changed ahead of the outcome of the Fed meeting and the assessment of earnings and the chances of a Donald Trump presidency. The 10-year is up 8/32 ot yield 1.80%.
Chief Economic Strategist Managing Director
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