Ready for this week to end? We thought so, but alas, there are six-and-a-half trading hours to get through before it is all said and done, and lots of political drama is unfolding in Washington over government funding issues.
At the moment, the cash market looks set for a higher open on this quarterly options expiration day. That means zero for how it is going to close, yet the underlying hope remains that this market is due for a bounce.
Such hope has been dashed repeatedly, as selling into signs of strength, and a host of other issues, has clobbered the market and investor sentiment this quarter.
Dow component Nike (NKE) did its part to help drive a turn in sentiment. The footwear and athletic apparel retailer topped fiscal second quarter estimates after last night's close. More importantly, it reported an increase in its gross margin rate and provided better-than-expected currency neutral revenue growth guidance for FY19.
Shares of NKE are up 9.0% in pre-market trading, which should be a nice trading beacon for shares of beaten-down retailers.
Whether the good vibes hold up for the broader market is the real question, though. That's what everyone is waiting to see.
Everyone seems primed to see the market bounce at this juncture, which is why downside price action can still be labeled the "pain trade."
There will be ample attention on Capitol Hill where a government funding bill is being hotly contested. The House voted last night to approve a funding bill, which included more than $5 billion for border wall funding. That bill is headed to the Senate where Senate Minority Leader Schumer believes it will be killed.
If so, and no compromise is struck, there will be a partial government shutdown at midnight tonight.
The specter of a shutdown hasn't bothered the market too much directly, yet there has been an indirect impact in that the political bickering has contributed to the heightened sense of uncertainty on a host of issues that have contributed to the inclination to sell into strength.
This morning's economic data featured the third estimate for Q3 GDP, which showed a downward revision to 3.4% from 3.5% (Briefing.com consensus 3.5%) and an upward revision to the GDP Price Deflator to 1.8% from 1.7% (Briefing.com consensus 1.7%).
This particular report should have little to no bearing on today's action given its dated nature.
The Advance Durable Goods Orders Report, meanwhile, won't be overlooked so readily. It was weaker than expected.
Durable orders increased 0.8% in November (Briefing.com consensus 1.7%) after an upwardly revised 4.3% decline (from -4.4%) in October. Excluding transportation, orders declined 0.3% (Briefing.com consensus +0.3%) after increasing an upwardly revised 0.4% (from 0.1%) in October.
The key takeaway from the report is that business investment was weak, evidenced by the 0.6% decline in nondefense capital goods orders excluding aircraft. Moreover, a 0.1% decline in shipments of those same goods will be accounted for as a negative input in Q4 GDP forecasts.
The Personal Income and Spending Report for November will be released at 10:00 ET and will also factor directly into the outlook for Q4 GDP.
For now, the outlook for the stock market is brighter at the moment than how it looked at the close yesterday, but overall, it is still cloudy with a chance of volatility.