Morning Note: Swept Up In Moods

The Bureau of Labor Statistics (BLS) October jobs report (released this morning) looks markedly better than this week’s ADP report (mentioned in yesterday’s morning note). Nonfarm payrolls increased by 638k vs 580k estimated. Permanent jobs losses remain at 3.7 million (among the 20 million still without work), but “remain” is the operative word. I.e., the number came in flat in October after major increases over the previous two months. More on this to come in this week’s macro update.

Asian equities did okay overnight, with 9 of the 16 markets we track closing higher. Europe’s mixed this morning, with 9 of the 19 bourses we follow currently in red. US major averages are taking a bit a breather after an impressive (save for the internals) 4-day rally: Dow’s flat -1 point, S&P 500 flat -0.01%, Nasdaq down 0.30%, Russell 2000 up 0.16%.

The VIX (SP500 implied volatility) is down 4.82%. VXN (Nasdaq vol) is down 2.68%.

Oil futures are down 2.55%, gold’s flat, -0.05%, silver’s up 0.28%, copper futures are up 1.77% and the ag complex is up 0.69%.

The 10-year treasury is down (yield up) and the dollar’s off 0.29%.

Led by base metals, materials, consumer staples, utilities and ag commodities, our core portfolio is enjoying a relatively nice start to the morning, up 0.34%. Tech stocks are the only drag.

The following speaks to me, in terms of present market conditions:

“Why should the market be any more perfect than the very human emotions and calculations that drive it? Investors overreact, and so do markets. Investors get swept up in moods, and so do markets. And this interplay creates investment opportunities.”

Leon Levy, The Mind of Wall Street

Have a great day!

Levy, Leon; Linden, Eugene. The Mind of Wall Street (p. 14). PublicAffairs. Kindle Edition. 


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