Good morning. Happy Monday. Happy Halloween. Hope you had a good weekend.
The Asian/Pacific markets closed mixed, but movement wasn’t much. Australia, Indonesia and New Zealand moved up; South Korea and Taiwan posted the biggest losses. Europe currently leans to the downside. France, Austria, the Netherlands, Sweden, Switzerland, Spain and Italy are down the most. Futures in the States point towards a positive open for the cash market.
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LB Weekly – the indexes, the breadth indicators, a look at the big picture
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The dollar is up. Oil is down; copper is flat. Gold is down; silver is up. Bonds are up.
I don’t have anything new to add to the report published yesterday morning. In it I concluded there isn’t much for the bulls to cling to. Market breadth is getting weaker. The quality and quantity of decent setups is waning, and the stocks that are breaking out aren’t following through much. The small caps have started to lag, and six of the nine S&P Select groups are trading below their declining 50-day moving averages.
If left alone the market should undergo a very normal and healthy correction to allow the charts to reset and start over. But we have an election coming up, and it’s my opinion the market government isn’t going to let the market drop much.
Be conservative out there. Preserve capital for a better environment. We saw what happened Monday when the Clinton/FBI news hit the wires. Right now the #1 thing the market wants is a smooth and uncontested election. Anything that would lead Wall St. to believe it won’t happen will cause lots of volatility in the near term. More after the open.
Stock headlines from barchart.com…
Level 3 Communications (LVLT +4.20%) jumped 4% in pre-market trading after CenturyLink agreed to buy the company in a cash, stock deal valued at $34 billion.
General Electric (GE +2.06%) is up 1% and Baker Hughes (BHI +8.38%) jumped nearly 9% in pre-market trading after GE agreed to combine its oil and gas business with Baker Hughes.
Time Warner (TWX -0.94%) was upgraded to ‘Outperform’ from ‘Market Perform’ at FBR Capital Markets with a 12-month target price of $104.
Cinemark (CNK unch) was upgraded to ‘Buy’ from ‘Neutral’ at Goldman Sachs with a 12-month target price of $46.
Fortune Brands Home & Security (FBHS -0.54%) was upgraded to ‘Overweight’ from ‘Neutral’ at JPMorgan Chase with a 12-month target price of $68.
AutoNation (AN -4.13%) was downgraded to ‘Neutral’ from ‘Buy’ at Bank of America/Merrill Lynch.
Home Depot (HD +1.08%) and Lowe’s (LOW -0.19%) were both downgraded to ‘Neutral’ from ‘Overweight’ at Piper Jaffray.
Chevron (CVX +3.90%) was upgraded to ‘Buy’ from ‘Neutral’ at Goldman Sachs with a 12-month price target of $118.
Sherwin-Williams (SHW -1.16%) said that it believes that “no or minimal” divestitures will be necessary to complete its acquisition of Valspar (VAL -7.14%) and said it expects the deal to close by the end of Q1-2017.
Tesla (TSLA -1.98%) CEO Elon Musk late Friday unveiled a new type of solar roof that will be offered by Tesla after its intended acquisition of Solar City (SCTY -0.53%). Musk also introduced a Powerwall 2 product with 14kWh of storage.
Crispr Therapeutics (CRSP +5.82%) rallied in after-hours trading after news that Bayer in a 13D filing disclosed a 12.8% stake in the company. In addition, GlaxoSmithKline (GSK -0.69%) disclosed an 8.3% stake in CRSP.
Baidu’s (BIDU +2.56%) rating was cut to neutral from outperform at Macquarie.
Today’s Economic Calendar
8:30 Personal Income and Outlays
9:45 Chicago PMI
10:30 Dallas Fed Manufacturing Survey
3:00 Farm Prices
Today’s Earnings here
Other…
today’s upgrades/downgrades from briefing.com
this week’s Earnings
this week’s Economic Numbers