U.S. Equity Markets closed higher for the seventh consecutive trading session, led by the 1% gain in the NASDAQ 100. Lower Treasury Yields and a crushed Oil helped the NASDAQ to again outperform the broader market. The last Federal Reserve meeting of 2023 is set for December, but new data has caused Barclays (BCS) to revise its outlook. It now predicts an increase in the benchmark lending rate to come in January 2024 rather than in December as previously expected. The firm believes that softer-than-expected employment data for October will lead the central bank to deliver a 25-basis-point hike at the start of next year. However, Barclays predicts we won’t see a Fed rate cut until at least September 2024. The Fed will closely monitor future unemployment and inflation data as it now focuses on its upcoming December decision. With the Federal Reserve’s monetary policy continuing to tighten financial conditions, Fed Governor Lisa Cook warned of vulnerabilities in nonbank financial institutions (“NBFIs”). During her speech at Duke University, the Governor specifically highlighted liquidity mismatches at nonbanks which could be subject to funding shocks or heightened volatility. Cook acknowledged potential losses for financial intermediaries could strain or even reduce credit supply. She plans to monitor weaknesses at NBFIs as well as developments in residential and commercial real estate markets as the Fed’s policy works its way into the economy. Hilton Grand Vacations (HGV) has agreed to purchase Bluegreen Vacations (BVH) in an all-cash deal valued at nearly $1.5 billion. The agreement requires Hilton to purchase Bluegreen stock at $75 per share, more than double the stock’s $35.52 closing price on Friday. Bluegreen shares more than doubled on the news, cresting at $73.48 per share after the market opened yesterday. The deal will increase Hilton’s membership base to more than 740,000 timeshare owners and add nearly 200 properties to Hilton’s resort portfolio. The transaction is expected to close during the first half of 2024. Just weeks after its initial public offering, Birkenstock (BIRK) has caught the attention of major Wall Street banks. With its loyal customer base and the belief that Birkenstock can maintain an impressive profit margin while expanding its market, a slew of investment banks has taken notice. Citigroup (C), Goldman Sachs (GS), and Jefferies Financial (JEF) have all raised the company’s price target and given it a top rating for expansion. Citigroup, which is particularly bullish on the sandal maker, set a target price of $52, marking a more than 20% jump from current levels. However, the optimism is not shared across the board. Morgan Stanley set a price target of $41 and suggested that most catalysts were already priced into the stock. European Markets closed higher. According to Bloomberg Economics, there is a 52% chance the U.K. will suffer through a mild recession in the second half of 2023. This estimate comes from economists Dan Hanson and Andrej Sokol who noted higher unemployment and soaring interest rates. Unemployment is currently measured at 4.3%, with the Bank of England projecting it to reach 5.1% by 2026. The U.K.’s gross domestic product (“GDP”) is expected to show a 0.1% contraction during the third quarter. A fourth-quarter contraction would mark two consecutive quarters of negative GDP and constitute a mild recession. Tesla (TSLA) is working to produce a €25,000 ($26,838) electric vehicle (“EV”) at its German factory. While an initial production date remains unknown, the arrival of a moderately priced EV would be a significant relief for Euro-Zone consumers who face an average EV price of €65,000. Plans were also announced to double the German plant’s capacity to 1 million vehicles per year. Expanding its German manufacturing plant is a crucial step in solidifying Tesla’s European foothold and achieving its goal of 20 million deliveries by 2030. Tesla also announced it is raising workers’ wages 4% starting this month. Elsewhere, Oil and Gold both fell yesterday, closing lower by 4.27% and 0.5% respectively.
To mark my 2900th issue of TraderNoble Daily Commentary I am offering a special 2-Year Rate of Euro 2750 for my Platinum Service which includes 1 to 4 updated emails throughout the trading day to demonstrate this value, a monthly subscription over the same period would cost 4440 euro in total This offer represents a 38% discount and is open to both new and existing members. If anyone is interested in this offer can you please email me on bryan@tradernoble.com for details
For anyone following my Platinum Service it made 26 points yesterday and is now ahead by 191 points for November. October ended with a gain of 3184 points, after closing September with a small gain of 228 points, after finishing August with 1485 points, following a small gain of 285 points gain in July, after closing June with a gain of 2683 points. May closed with a gain of 3205 points. April saw a gain of 3354 points while March closed with a gain of 6168 points. The Platinum Service made a record 9619 points last October. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1900 points. I have a YouTube Channel which contains recent interviews I have given This can be viewed by clicking HERE Please subscribe to this for new interview notification
Equities
The S&P 500 closed 0.28% higher at a price of 4378.
The Dow Jones Industrial Average closed 56 points higher for a 0.17% gain at a price of 34,152.
The NASDAQ 100 closed 0.93% higher at a price of 15,296.
The Stoxx Europe 600 Index closed 0.26% higher.
Yesterday, the MSCI Asia Pacific closed 0.6% lower.
Yesterday, the Nikkei closed 1.34% lower at a price of 32,271.
Currencies
The Bloomberg Dollar Spot Index closed 0.22% higher.
The Euro closed 0.2% lower at $1.0698.
The British Pound closed 0.3% lower at 122.98.
The Japanese Yen fell 0.2% closing at $150.38.
Bonds
Germany’s 10-year yield closed 8 basis points lower at 2.66%.
Britain’s 10-year yield closed 10 basis points lower at 4.28%.
U.S.10 Year Treasury closed 8 basis points lower at 4.57%.
Commodities
West Texas Intermediate crude closed 4.27% lower at $77.37 a barrel.
Gold closed 0.5% lower at $1969.10 an ounce.
This morning on the Economic Front we have German CPI at 7.00 am, followed by a speech from U.K. Governor Bailey at 9.30 am and Euro-Zone Retail Sales at 10.00 am. Next, we have U.S. MBA Mortgage Applications at 12.00 pm and a speech from Fed Chair Powell at 2.15 pm. Finally, we have Wholesale Inventories at 3.00 pm and a 10-year Treasury Auction at 6.00 pm.
Cash S&P 500
Although the S&P closed higher for the seventh consecutive trading session, it was another quiet session for volatility with little or no price action. I am still expecting a small correction over the next few days ahead of the November 17 funding requirement before another strong rally into seasonally strong Thanksgiving period and first week of December. If we do get a correction, it should be contained at the 50-Day Moving Average which comes in at a price of 4345 this morning. The S&P has strong resistance at the 100 MA which comes in at 4403 and the 20 MA which comes in at 4395. As I am still flat the S&P, I will now raise my sell level to 4395/4412 with a higher 4429 ‘’Closing Stop’’. The S&P has support from 4335/4350. I will now raise my buy level to this area where I will be strong buyer on any dip with a higher 4319 ‘’Closing Stop’’.
EUR/USD
After the Euro hit my 1.0665 buy level we had a small rally, enabling me to cover this position at my revised 1.0691 T/P level and I am now flat. Today, I will again be a buyer on any dip lower to 1.0580/1.0650 with a lower 1.0535 ‘’Closing Stop’’. I still do not want to be short the Euro at this time.
September Dollar Index
I am still flat the Dollar as the market never came close to yesterday’s buy range. I will now raise my buy level to 104.40/105.10 with a higher 103.85 ‘’Closing Stop’’.
Cash DAX
The DAX traded heavy again yesterday and I am still flat. The DAX has short-term support from 14930/15010 where I will continue to be a buyer with a tight 14855 ‘’Closing Stop’’. Despite the overbought condition of the market I have no interest in being short the DAX at this time.
Cash FTSE
The FTSE traded in a narrow 38-point range yesterday and I am still flat. I cannot remember the last two days when we had so little price movement in the FTSE. I will continue to be a buyer on any dip lower to 7290/7360 with the same 7245 ‘’Closing Stop’’. I still do not want to be short the FTSE at this time.
Dow Rolling Contract
I am still flat as the Dow missed my sell range. As I am back short the NDX, I will again raise my Dow sell level to 34330/34550 with a tight 34705 ‘’Closing Stop’’. If I am taken short I will have a T/P level at 34185. I still do not want to be long the Dow at this time.
Cash NASDAQ 100
The NDX again led yesterday’s rally, hitting my 15220-sell level in the process. I will look to add to this position at 15370 while leaving my 15505 ‘’Closing Stop’’ unchanged. I will now raise my T/P level to 15130. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
December BUND
I am still flat the Bund as the market just missed yesterday’s sell range. Ahead of Powell’s speech this afternoon, I will now raise my sell level to 131.05/131.85 with a higher 132.45 ‘’Closing Stop’’.
Gold Rolling Contract
The stronger Dollar saw Gold hit my buy level for a now 1966 long position. I will add to this position at 1951 with a now lower 1939 ‘’Closing Stop’’. I will have a T/P level at 1975. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Silver Rolling Contract
No Change. I am still long Silver from six weeks ago at 24.05. Silver has traded in a narrow 100-point range with very small daily ranges over the past few weeks. I am extremely bullish of Silver while frustrated that Silver has not followed the price of Gold higher. In a change of strategy, I will have no stop or no T/P level on this position. This morning Silver is trading lower at 22.55. If this view changes, I will be back with a new update for my Platinum Members.
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