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HOW MUCH LOWER CAN THIS ELECTION GO?

Like many I am disgusted with the two candidates of the 2016 election.  One is a boorish thug and the other is engrained in the establishment believing the rules do not apply to her.  The media is more focused upon sexual issues 15-30 years ago rather than the major issues facing the country today.

For many November’s election comes down to who one less detests.

With this written however, the attitude can radically change if there is a proverbial bombshell that indicates a gross violation of law that indicates power overtaking justice.  Yes there are examples of such but there must be some event that is so blatant that it turns even the most ardent of supporter where all demand justice.

There is little I write about yesterday’s market action.  Most are waiting for the approximate 80 S & P 500 earnings reports that will be posted in the next four days, as well the Beige Book and remarks from various Fed speakers.  Treasuries and utilities were nominally higher, perhaps on a dead cat bounce as both groups have declined about 10% in recent trading sessions. Both oil and the dollar fell.

Last night the foreign markets were up.  London was up 1.17%, Paris up 1.37% and Frankfurt up 1.24%.  China was up 1.40%, Japan up 0.38%and Hang Sang up 1.55%.

The Dow should open moderately higher on increased optimism the world’s largest economy is strong enough to cope with a gradual pace of tightening.  The odds of a December rate hike remain unchanged at 67%.  Earning season also accelerates today.  How will the results be interpreted?  Revenues are expected to rise while profits are expected to fall, an indicator of the “price is the only determinate of purchasing decision” economy.    The 10-year is unchanged at 1.77%.

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Ken Engelke

Chief Economic Strategist Managing Director

The views expressed herein are those of Kent Engelke and do not necessarily reflect those of Capitol Securities Management. Any opinions expressed are statements of judgment on this date and are subject to certain risks and uncertainties which could cause actual results to differ materially from those currently anticipated or projected. Any future dividends, interest, yields and event dates listed may be subject to change. An investor cannot invest in an index, and its returns are not indicative of the performance of any specific investment. Past performance is not indicative of future results. This material is being provided for informational purposes only. Any information should not be deemed a recommendation to buy, hold or sell any security. Certain information has been obtained from third-party sources we consider reliable, but we do not guarantee that such information is accurate or complete. This report is not a complete description of the securities, markets, or developments referred to in this material and does not include all available data necessary for making an investment decision. Prior to making an investment decision, please consult with your financial advisor about your individual situation. Investing involves risk and you may incur a profit or loss regardless of strategy selected. There is no guarantee that the statements, opinions or forecasts provided herein will prove to be correct. If you would like to unsubscribe from this e-mail distribution, please reply to this e-mail and indicate that you wish to unsubscribe in your response.