Before the Open (Oct 8)

Good morning. Happy Tuesday.
The Asian/Pacific markets closed mostly up. China, Hong Kong and Indonesia did the best. Europe is currently mostly down. Austria, Belgium, Norway, Switzerland, Spain and London are posting the biggest losses. Futures here in the States point towards a flat open for the cash market.

The dollar is up slightly. Oil and copper are up. Gold and silver are down.
Here’s the S&P over the last six days. Lots of up and down. Lots of gap opens. Several sudden reversals. And in the end the net change is very little.

The government shutdown continues. The longer it lasts, the worse it will be in the near term. But as I’ve said a few times, lower prices in the near term will likely be a blessing in disguise. Trader and investors will have the opportunity to buy stocks at lower prices. The shutdown sucks for those who aren’t getting a paycheck right now, but for everyone else, it will, in my opinion, turn out to be a non-issue.
Even though we have some good long set ups on the Long List, risk is elevated. Unless the stock is a great performer (you often don’t know this until after the fact), you gotta be content with small gains. The chart above tells us we’re not getting much follow through. And when the shutdown ends, there’s no guarantee the market is going to take off. It’s entirely possible we get a knee-jerk pop which then gets sold into. Then after a couple weeks of selling, a bottom is put in place and we get a year-end rally that makes new highs. Be flexible. Be open minded. Be on your toes.
Stock headlines from barchart.com…
Crown Holdings (CCK -0.48%) was downgraded to “Market Perform” from “Outperform” at Wells Fargo.
Wells Fargo downgraded the Packaging industry to “Market Weight” from “Overweight” on expectations consumer demand will be muted over the next 6-12 months.
Piper Jaffray kept its “Overweight” rating on Starbucks (SBUX -0.70%) and raised its price limit on the stock to $85 from $75.
Wells Fargo (WFC -1.65%) was downgraded to “Neutral” from “Outperform” at Macquarie.
J.C. Penney (JCP -1.91%) was downgraded to “Neutral” from “Buy” at Sterne Agee.
Talisman Energy (TLM +4.59%) surged 11% in after-hours trading after billionare investor Carl Icahn reported a 5.97% stake in the company.
Avon Products (AVP -1.19%) and Procter & Gamble (PG -0.49%) were both upgraded to “Outperform” from “Market Perform” at Wells Fargo.
Whole Foods (WFM -0.67%) was initiated with a “Buy” at Jefferies with a price target of $70.
SolarWinds (SWI -2.21%) announced that it has acquired privately held Confio Software for $103 million.
Earnings and Economic Numbers from seekingalpha.com…
Today’s economic calendar:
7:30 NFIB Small Business Optimism Index
7:45 ICSC Retail Store Sales
8:30 Trade Balance
8:55 Redbook Chain Store Sales
10:00 Job Openings and Labor Turnover Survey
1:00 PM Results of $32B, 3-Year Note Auction
Notable earnings before today’s open: WWW
Notable earnings after today’s close: AA, ADTN, YUM
Other…
today’s upgrades/downgrades from briefing.com
this week’s Earnings
this week’s Economic Numbers