U.S. Indices chopped on Tuesday as eyes turn to the FOMC on Wednesday but the Russell outperformed while Dow Jones lagged. Dow weakness ensued after JPM’s Lake gave some Q4 guidance – IB revenue up low-single digits, and markets revenue up low teens. This hit JPM shares and also weighed on the Financial sector. Energy, Consumer Staples, and Consumer Discretionary sectors outperformed, while Health Care, Industrials and Real Estate underperformed – Financials also closed lower. T-Notes flattened in response to the September and October JOLTS report, which saw a notable increase from August – rising to 7.67 million in October from 7.23 million in August – well above the 7.15 million forecast. This saw traders pare rate cut bets in 2026, but December pricing was little changed – participants still price an 88% probability of a 25bps rate cut this evening. The data also gave a helping hand for the Buck, while the Japanese Yen lagged following the 7.6 magnitude in Japan overnight. The Australian Dollar outperformed after the RBA, which held rates as expected, but Governor Bullock leant hawkish. She said the outlook is for an extended pause, or hike, and does not see rate cuts in the foreseeable future. Oil prices settled lower with focus remaining on Russia/Ukraine, where Zelensky said Ukraine and Europe are ready to present a peace plan to the US. Meanwhile, Trump told Zelensky he wants Ukraine to agree to ceasefire by Christmas, and Zelensky sees leader level talks with the US next week. Gold and silver prices were bid, particularly the latter which rose above USD 60/oz to fresh record highs, from an earlier lower of 57.62. Note, there was a lot of focus on US/Sino relations – where the US is to approve NVIDIA (NVDA) H200 chip exports to China, but under special security reviews, while China will reportedly limit the imports. Elsewhere, CNBC reported that China is buying US soybeans again but falling short of the goal set by the Trump trade agreement. The October and September JOLTS report was released, which saw the September print jump to 7.658 million from August’s 7.227 million print, before rising further in October to 7.670 million. Meanwhile, the Vacancy rate rose to 4.6% in September from 4.3% in August, and was unchanged in October at 4.6%. The quits rate rose to 2.0% in September from 1.9% in August, but fell to 1.8% in October. The data shows an improvement in the state of the labour market from the end of summer, with JOLTS rising, which could support the case of the hawks, but Oxford Economics highlight the rise in the layoff rate could embolden calls from the doves – the layoff rate rose to 1.2% in October, from 1.1% in September and August, albeit it has been within a 1.0-1.2% range since December 2022. Oxford Economics also point out that “The difference between the number of hires and separations, a proxy for the next change in nonfarm employment at the end of October, was 99,000. This points to another healthy gain in nonfarm payrolls in October, at least in the private sector.” October NFP will be released on December 16th, alongside the November report, but there will be no October unemployment rate. The Federal Reserve is widely expected to cut rates by 25bps to 3.50-3.75%, with Fed money markets currently pricing in an 88% chance of such an outcome, and this comes despite widening divisions among policymakers. The latest cut would follow Octoberʼs reduction, although Chair Powell cautioned then that a December cut was far from assured and gave an analogy that “driving in the fog, you could slow down”. Given the Government shutdown, key data has been delayed, and little has been seen since the prior meeting, but in the following week, we will see the October and November NFP, the November Unemployment rate, and the November CPI. Although markets are heavily pricing in a cut, it is a close call as shown by expected votes, and given this, there is a widely held view that it will be a “hawkish cut”. JPM generally agrees with this view and adds that one way this could be conveyed would be for the statement to mimic last yearʼs forward guidance. Last Novemberʼs statement referenced “In considering additional adjustments…” which was followed by a cut in December, and then the Dec. statement was adjusted to say “In considering the extent and timing of additional adjustments…” which was followed by a pause in rates until September 2025. By reverting to the extent and timing guidance, the Committee could hint at a pause in the coming January meeting. Ahead, Rabo Bank expects the Fed to continue its cutting cycle at least until its estimate of the neutral rate is reached. Elsewhere, Oil closed lower by 0.85% while Gold ended Tuesday’s session with a gain of 0.5%
To mark my 3300th 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 was flat yesterday and is still ahead by 1062 points for December after ending the month of November with a gain of 4542 points, after ending October with a nice gain of 5110 points after closing September with a gain of 3774 points while ending August with a gain of 3362 points after closing July with a gain of 3753 points after closing June with a gain of 3530 points, having closed May with a gain of 3606 points, after closing April with a gain of 7685 points after closing March with a gain of 2254 points while closing February with a gain of 4180 points. January ended with a gain of 2768 points while 1997 points were gained in December. October ended with a gain of 2179 points, after closing September with a gain of 4402 points, following a loss of 301 points in August. July gained 1908 points while June saw a gain of 2074 points. The Platinum Service made a record 9619 points in October 2022. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 2300 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
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