The collision of global markets and social mood

Tuesday, October 25, 2016

Tuesday -- Confidence

S&P E-mini Futures:
Bouncing along the flat line.

News:
Today it's all about confidence.

Germany's IFO business climate survey came out better than expected, the highest level since 2014, after yesterday's better than expected PMI reading. France slipped, however, for yet another example of mixed mood. The US follows at 10 am ET.

The US September Consumer Confidence Index surged to 104.1, the highest since August 2007, so all eyes will be on it.

With confidence running high, it's interesting to find the latest example of it in the consumer space. Never mind San Francisco's $43 martini. In Sweden, beer drinkers can now pair their craft brew with the most expensive potato chip in the world.



How much? Try $11 . . . per chip.

That's peak social mood for you.

FX:
Confidence has also trickled into FX today where commodity heavy AUD is up (for the moment, that is) alongside a stronger USD. Also safe havens JPY and CHF are weaker. Risk On.

FX traders sound more and more confident that a December rate hike is reason enough for USD strength, and not EM dollar funding stress.

Too bad EUR is not joining it.

Treasuries:
These should bounce and they're having trouble.

Energy:
WTI crude got its bounce yesterday -- after a scary morning plunge. NG kept plunging.

Metals:
Gold is still a hard-to-read chop fest, while silver seems to be watching the action in platinum, palladium, and copper, all up over 1% at the moment.

S&P Outlook:
Speaking of confidence, it's the Naz.

The Nasdaq Composite looks like it could be setting up for record highs which would likely be unconfirmed by the Dow, S&P, and Russell. In other words, a bearish indication.

Fresh from the AT&T/Time Warner news with its tech bubble echo from 2000, which we are learning that will be just another massive debt bomb, the current pattern looks more and more like and ending one.

Not to worry. If it did come to pass, the 4200 area would probably represent a huge buy area.


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