S&P 500 did slowly grind higher, and the lower volume isn‘t an issue as bonds confirmed amply. The risk-on turn continues, driven by value with tech still saving its bullets. Anyway, the retreat in long-dated yields isn‘t creating headwinds, an no matter the deteriorating earnings, the time to turn really bearish on S&P 500 and Nasdaq hasn‘t come.
Not even the array of events already in and still to culminate with the Fed minutes, is to throw the buyers off balance. Yes, fears of a significant downswing are there, but I‘m not looking for one to take us into 3,8xx values – it‘s actually about how fast we clear the 4,010s and especially 4,040 that would determine how far this Q4 rally can reach. Its best days are ahead, in Dec respecting seasonality patterns and enjoying the 50bp hike only.
The dollar is under pressure, long end of the curve down, yet commodities aren‘t firing on all cylinders. The price cap uncertainty is taking its toll on oil while natgas enjoys seasonally and fundamentally strong showing. Copper is likewise to reverse higher the way silver found easy to do. Oil stocks and miners aren‘t panicking – quite to the contrary, and that‘s what counts most. Cryptos aren‘t making here a bottom – just working to suck in buyers before ultimately going lower – the adventurous and patient can act.
