Even though there was no material worsening of the situation in Israel, U.S Equity Markets got hit hard yesterday following Treasury Yields rising to a new 16-year high at 4.94%. A better than expected 20-year Treasury saw Yields have a small fall into the close. However, Equity Markets still reversed, as the VIX rose 8%, closing just below the key 20 resistance level. Higher Yields saw the NASDAQ 100 lead Wednesday’s declines, closing lower by 1.41%. Spurred on by the recent positive data, Morgan Stanley (MS), JPMorgan Chase (JPM), and Goldman Sachs (GS) raised their GDP growth forecasts to as high as 4.9%. This show of strength in consumer demand and spending despite several headwinds, will make for a difficult Fed decision at the next meeting in November. Bank of America (BAC) had its best third quarter earnings in more than 10 years. Net income and stock-trading revenue each jumped 10%, to $7.8 billion and $1.7 billion, respectively. The financial giant has benefited from the dramatic market swings amid the Federal Reserve’s monetary-tightening campaign. According to CEO Brian Moynihan, the bank gained clients and accounts across all lines of business while operating in a “healthy but slowing economy.” Chipmaker Nvidia’s (NVDA) stock fell Tuesday after President Joe Biden rolled out more restrictions on U.S. semiconductor sales to China. The company is a major manufacturer of artificial intelligence (“AI”) chips, and its A800 and H800 chips – specifically designed for China – are now banned for export. The rules require domestic chipmakers to apply for a license before shipping to two rival Chinese AI chips and require companies to obtain a U.S. government license before shipping products to the firms. The impact of additional restrictions on Nvidia highlights the balancing act between maintaining national security and fostering growth in the U.S. semiconductor market. Johnson & Johnson (JNJ) said it will begin a two-year restructuring programme for its orthopaedic business. The announcement comes on the news that the company’s third-quarter medical-device sales failed to live up to Wall Street’s estimates. As part of its new plan, Johnson & Johnson will exit select markets and stop selling various products under its orthopaedic business. The move is expected to put extra pressure on the company to reach its goal of $57 billion in drug sales by 2025. Despite missing expectations, Johnson & Johnson raised its annual profit forecast on the backs of its strong pharmaceutical sales, namely its popular arthritis drug Stelara. European Markets closed lower. According to the ZEW Institute’s gauge of expectations, German investor confidence grew for the third consecutive month. The sentiment gauge jumped to negative 1.1 in October, up from September’s reading of negative 11.4. Also, more than 75% of respondents see stable short-term interest rates for the Euro-Zone. The steady increase in investor confidence signals optimism that the European Central Bank’s monetary-tightening campaign may finally help Germany overcome its current economic struggles. In contrast to the downturn expected for the second half of this year, a rebound is expected for 2024 with economic growth increasing to 1.3%. Swati Dhingra, a voting member of the Bank of England (“BOE”), believes that wage pressures will ease, followed by a cooling of inflation. In her speech at an economic summit on Tuesday, wage trends, falling producer prices, and subdued profit growth will all help lower inflation. Her stance differs from the hawkish BOE members who support more tightening to prevent high inflation expectations from creeping in. Dhingra also said she is concerned that further tightening could harm supply capacity and lead to stagflation. Her recent comments suggest that she will maintain her dovish stance at the BOE’s next meeting. Elsewhere, Oil rose 1.71% while following a volatile trading session that witnessed plenty of two-way price action, Gold ended Wednesday with a gain of 1.2%.
To mark my 2875th 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 lost 260 points yesterday and is now ahead by 2441 points for October after closing September with a small gain of 228 points, after finishing August with 1485 points gain 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 3164 points in February, 4687 points in January 2054 points in December, 4789 points in November and 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 1.34% lower at a price of 4315.
The Dow Jones Industrial Average closed 332 points lower for a 0.98% loss at a price of 33,665.
The NASDAQ 100 closed 1.41% lower at a price of 14,909.
The Stoxx Europe 600 Index closed 1.05% lower.
Yesterday, the MSCI Asia Pacific closed 0.6% lower.
Yesterday, the Nikkei closed 0.01% higher at a price of 32,042.
Currencies
The Bloomberg Dollar Spot Index closed 0.31% higher.
The Euro closed 0.3% lower at $1.0537.
The British Pound closed 0.3% lower at 121.39.
The Japanese Yen fell 0.1% closing at $149.94.
Bonds
Germany’s 10-year yield closed 3 basis points higher at 2.91%.
Britain’s 10-year yield closed 16 basis points higher at 4.67%.
U.S.10 Year Treasury closed 7 basis points higher at 4.90%.
Commodities
West Texas Intermediate crude closed 1.71% higher at $88.24 a barrel.
Gold closed 1.2% higher at $1949.10 an ounce.
This morning on the Economic Front we have Euro-Zone Current Account at 9.00 am. This is followed by U.S. Weekly Jobless Claims and the Philly Fed Manufacturing Survey at 1.30 pm. Next, we have Existing Home Sales at 3.00 pm. Finally, a busy day for Fed Speakers as Jefferson, Powell, Goolsbree, Bostic and Harker are all speaking at 2.00 pm, 5.00 pm, 5.20 pm, 9.00 pm and 10.20 pm respectively. Obviously Fed Chair Powell’s will be the most important.
Cash S&P 500
Wrong! Despite a number of false rallies throughout the day the S&P closed over 1% lower. The initial sell-off had me long at an average rate of 4345 before stopping me out of this position at 4322. In contrast to the rest of October when any dips in the S&P were bought, yesterday’s drip down action produced a capitulation flush before having a small rally off its 4304 low print into the close. For investors with a fixed position this is a frustrating chop while for day traders we are seeing plenty of two-way price action. Even though it did not work for us yesterday this increased volatility has worked well for my Platinum Service so far in October. Both the 150 Day Moving Average and the 20 MA held which is a slight positive. As a result, I emailed my Platinum Service to buy the S&P again at 4322. I will add to this position at 4303 with a lower 4289 ‘Closing Stop’’. I will have a T/P level on this position at 4338. The S&P now has five ‘’Open Gaps’’ above which is unusual and is one of the main reasons why I have no interest in being short. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
EUR/USD
No Change. The Euro just missed yesterday’s initial 1.0520 buy level by three points before having a small rally into the close. Today, I will continue to be a buyer on any dip lower to 1.04450/1.0510 with the same 1.0395 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 1.0580.
September Dollar Index
No Change. The Dollar has resistance from 106.80/107.40 where I will continue to be a seller with the same 107.75 higher ‘’Closing Stop’’.
Cash DAX
After the DAX hit my 15090-buy level I had too many open positions. Subsequently, I emailed my Platinum Members to exit any long position at 15110 and I am still flat. This morning, the DAX is trading lower at 15050. We have strong support from 14850/15930 where I will be an aggressive buyer with a 14765 ‘’Closing Stop’’. I still do not want to be short the DAX at this time.
Cash FTSE
A massive 16-basis point rally in U.K. Gilt Yields saw the FTSE trade heavy yesterday. This sell-off saw the FTSE hit my 7580-buy level. I will add to this position on any further move lower to 7510 with the same 7435 ‘’Closing Stop’’. I will now lower my T/P level to 7615. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Dow Rolling Contract
Just like the DAX above, after the Dow hit my 33800 buy level, we had a tiny rally enabling me to cover this position at my revised 33850 T/P level and I am now flat. Closing below the 200 Day Moving Average is not positive but this is the chop that we are dealing with at this time. The Dow has support below from 33300/33500 where I will again be a buyer with a 33145 ‘’Closing Stop’’. I still do not want to be short the Dow at this time.
Cash NASDAQ 100
The NDX led yesterday’s declines, trading the whole of my buy range for a now 14955 average long position. Better earnings from Netflix sess the Futures Market higher overnight helped by $NFLX rising 9%. I will now lower my T/P level on this position to 15080 while leaving my 14795 ‘’Closing Stop’’ unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
December BUND
No Change., I am still long from Tuesday at an average rate of 128.70 with the same 127.75 ‘’Closing Stop’’. I will now lower my T/P level to 129.15. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Gold Rolling Contract
Gold surged yesterday, trading $150 higher from where we were 10 days ago. This is a massive move on Geo-political risk. I am still flat Gold, and I am going to stay this way until my Daily Commentary returns on Monday as I feel I have no edge in Gold at this time.
Silver Rolling Contract
No Change. I am still long Silver from five weeks ago at 24.05. In a change of strategy, I will have no stop or no T/P level on this position. This morning Silver is trading slightly higher at 22.95. If this view changes, I will be back with a new update for my Platinum Members.
Please Note: There will no Daily Commentary tomorrow (Friday). Any calls that are not hit today and are subsequently triggered tomorrow will see me return with updated emails for my Platinum Members.
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