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Week of October 7th – 11th

  1. The Dow Jones Industrial Average rose 242.87 points, or 0.9%, to 26,816.59, while the S&P 500 index advanced 0.6%, to 2970.27, and the Nasdaq Composite gained 0.9% to 8057.04. The Dow and the S&P 500 snapped three-week losing streaks, while the Nasdaq has now gained for two straight weeks
  2. Investors keep selling but the market keeps raising
  3. This market has risen despite investors pulling money out. Amazing!

    1. The numbers of the week: 
      1. CPI and PPI were below expectations but the market did not pay much attention.
      2. German Industrial Production was getting better
      3. Lower rates are helping the housing 
      4.  
      5. Powell: the Fed will expand the balance sheet again. Do not call it QE4, but it will have a similar effect, buy bonds and risky assets. The markets is scratching its head about the Repo problem. There are no clear explanations about this issue.
      6. WeWork faces a cash crunch and needs new funds by the end of November after its failed IPO, the FT reported. The company’s bankers are trying to secure a debt finance package by next week. JPMorgan is leading the talks and mulling a large contribution to any bailout.
      7. Iranian tanker attacked off the coast of Sadi Arabia.
      8. Apple at all time highs
      9. We got the China-US deal.  Phase one: more purchase of soybeans, no tariffs on October 18.
      10. The Census Bureau reports retail-sales data for September. Consensus estimates are for 0.3% gain after a 0.4% rise in August. Excluding autos, retail sales are expected to jump 0.2% after a flat August.
      11. In a speech, Federal Reserve Chairman Jerome Powell said the central bank would resume buying Treasuries to alleviate strains in short-term lending markets. Powell stressed that this is not a return to quantitative easing. Stocks, however, rose on the news.
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