EmailFor the first time since Friday, the opening bell will ring at the NYSE. The sound of that bell will signify that the U.S. equity market is open for business again after a two-day, weather-related closure that was the first of its kind since 1888.
It will be a treat to see this Halloween day and hopefully there won't be any technological tricks as the session unfolds.
At the moment, the cash market is on track for a higher open in what many think will be a choppy day of trading given month-end activity and lingering uncertainty about the economy, the election, and the earnings outlook. Undoubtedly, we will hear a lot about "Sandy plays" or stocks that may see outsized moves based on whether they are thought to be helped or hurt by the destruction in the east.
Names like Home Depot (HD), Lowe's (LOW), and Generac (GNRC) are commanding some early attention as likely beneficiaries while casino operators in Atlantic City (eg., CZR and BYD), airlines, and many apparel retailers are seen as being hurt by the business interruption.
As we noted Monday, when a storm impacts an estimated 60 mln people, it is safe to say that just about every industry group will see the adverse effects of business interruption. On the flip side, though, they will see the benefits of pent-up demand that help offset initial losses.
Today's popular hurricane trades, therefore, carry a risk of being overplayed and will require good timing instincts by those trading the stock idea as opposed to investing in the company.
Earnings results continue to flow with no change in the overall complexion. More companies are beating estimates on the bottom line while missing estimates on the top line and issuing negative guidance.
Headliners today include General Motors (GM; beat by $0.30), Phillips 66 (PSX; beat by $0.63), Mastercard (MA; beat by $0.24), and Clorox (CLX; beat by $0.05), all of which beat the S&P Capital IQ consensus earnings estimate by a handy margin.
Their positive earnings surprises have helped offset the disappointments from Eaton (ETN; missed by $0.03), Cummins (CMI; missed by $0.04), Seagate (STX; missed by $0.25) and AGCO (AGCO; missed by $0.05).
Separately, it was reported that the employment cost index for the third quarter increased 0.4% after increasing 0.5% in the second quarter. That was close to the Briefing.com consensus estimate that called for 0.5% growth.
Growth in salaries slowed (up 0.3% from 0.4%) and compensation gains were compensated with stronger benefits (0.8% from 0.6%).
There was little reaction to the employment cost index. That may not be the case for the October Chicago PMI report (Briefing.com consensus 50.9; prior 49.7) at 9:45 a.m. ET if it produces a notable surprise since it is a more current report.
Stay tuned. Today should be an interesting day of trading. The S&P futures are currently 0.5% above fair value.
