Market Recon Friday

Good Morning,
                       Answering your first question as you arise this morning, the Bank of Japan sat on their hands last night, leaving monetary policy unchanged.  After choosing not to add kerosene to the fire, because BOJ Gov. Kuroda feels that inflation is trending higher over there, the Nikkei 225 might just be the only green on your screen this morning.  Here, in the States, we’ve got a great deal of interesting macro data in our paths today, and almost all of it, is pretty interesting stuff, whether you’re trading around it, or just trying to keep your job.  We’ve pretty much taken October, and kicked it’s tail…..So, get yourself a cup of coffee, fix bayonets, and let’s finish this.
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Here They Come
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08:30
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PCE (September):  Here it is, the one that has them talking in DC.  Pardon me, but given a choice….. I’ll take a pass on higher inflation.  Something tells me that one of these days, not today, nor tomorrow, but one of these days, we’ll end up with a consumer level inflation rate that leaves our stagnant wages in the dust.  At that time, Janet and the gang will have no choice when it comes to interest rates, and it must scare the heck out of them.  Scares the heck out of me.  For today, we are looking for a headline rate of -0.1% m/m, down from 0.0% in August.  the Core rate could be a horse of a different color though.  Expectations for the Core are for growth of 0.2% m/m, up from last month’s 0.1%.  Signs of an unwelcome divergence ?
Personal Income (September):  Really, what’s more important than this data-point on the grand scale ??  The good news is that we’re looking for a positive number.  The bad news is that consensus is for month over month growth of 0.2%, which would be the lowest growth seen since March.  This would also be off of the 0.3% pace that we saw in August.
Consumer Spending (September):  Here again, the expectation is for 0.2% m/m growth, which is not so hot if you’re tracking the velocity of money, but at least it’s does not outpace our expectations for Personal Income.  That’s good for the average guy or gal out there who’s trying to make it against all odds.  This should be the lowest monthly gain in this space since April.  Fight on, gang.  They can only beat you, if you believe they can.
Employee Cost Index (Q3):  Ever wonder why the boss keeps you on as a consultant ??, or the only businesses that seem to show interest in hiring you are those offering sales based commission type work ??  In Q2, employers caught a break when, the cost of keeping someone employed grew just 0.2% q/q, which was well under consensus at the time.  Our expectations for Q3 are for an increase of 0.6% q/q, which in my opinion makes you both costly and vulnerable.  Feeling lucky ??  Just the facts, Ma’am.
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09:45
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Chicago PMI (October):  This item, which always leads the ISM data by a day or two looks set to lead the ISM straight into the abyss this month.  In September, the Chicago PMI came in shockingly low, and in contraction.  Well, now that every regional Federal Reserve district that reports manufacturing data has reported contraction for two straight months (oh joy), you can likely expect some more here, and maybe even on Monday (ISM)…egads !!
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10:00
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U of M Consumer Sentiment (October final):  This survey made a surprisingly optimistic showing in the preliminary report two weeks ago, and those who make educated guesses on this kind of stuff do expect it to stick, despite the big miss earlier in the week for the very similar Consumer Confidence.  Look for something close to 92.5 here today.  This one moves markets you freaks.
Fed Speaker:  San Francisco Fed Pres. John Williams will speak on interest rates from Washington, DC. at the Brookings Institution.  Williams is a voting member of the FOMC.
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11:25
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Fed Speaker:  Kansas City Fed Pres.  Esther George speaks from Kansas City on the structure of the Federal Reserve Bank.  She is not a voting member of the FOMC this year.  Let’s just hope that her city’s basball team loses tonight.  Actually, that last point is more important than anything she says.  Just sayin’.
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If you’re still with me. I give you a lot of credit.  After work today, get yourself a frosty, cold beverage, and a disgusting plate of nachos.
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Friday’s Earnings Highlights
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Before the Open: BUD (1.30), CVX (.74), CVS (1.29), XOM (.90), MCO (1.07), MYL (1.37), PSX (2.24)
After the Close:  Go get those nachos.
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World Series Game 3
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KC Royals Ventura (13-8, 4.08) at NY Mets Syndergaard (9-7, 3.24)
Thor’s Hammer….nuff said.
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Sarge’s TRADING LEVELS
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SPX: 2111, 2103, 2094, 2086, 2078, 2070

RUT: 1185, 1178, 1171, 1165, 1158, 1154