11/1/19 Market Notes
Much weaker than forecast Chicago PMI data, some disappointing earnings, and reports of a very tempered and watered-down Sino-American trade deal all lead to sharp declined in major market indexes on Thursday.
At one point the Dow Jones Industrial Average had lost as much as 1%, before recovering much of its losses to close 0.52% (140 points) lower. The S&P and NASDAQ also paired losses ending 0.30% and 0.14% lower respectively, as nine of the eleven sectors of the S&P ended lower. Communication Services and Utilities were the bright spots amongst the sectors, as the economically sensitive Materials and Industrial sectors declined more than 1%.
European and Asian bourses are mostly higher this morning, as are U.S. premarket equity futures after the October jobs report showed robust strength in hiring, in spite of layoffs and strikes by GM. Moreover, the August and September jobs figures were revised upward, striking down fear of an eminent recession. Treasury yields had declined, but reversed course after the strong jobs report, as the benchmark Ten Year Treasury yield trades at 1.70%. However, the yield curve is continuing to flatten, as longer term yields are dropping at a faster pace than their short term counterparts.
Looking ahead, investors will be paying attention to this morning’s ISM data, as well as earnings reports from Berkshire Hathaway (BRKB), Chevron (CVX), Exxon Mobil (XOM), and AIG (AIG). Next week’s Factory Orders report (Monday), ISM non-manufacturing and Productivity Report are amongst the key economic releases that could drive market direction.
The 1879 Advisors Investment Committee
Disclosures: This market commentary is written by the 1879 Advisors Investment Committee and represents the views of 1879 Advisors. This commentary is not investment advice and should not be used as a basis to make investment decisions. Please consult with your registered investment advisor before making any investment decisions.