Page One
Election Day is here, and it must feel like the Fourth of July, Halloween, and Christmas Day wrapped into one for political pundits. There will be fireworks, there will be treats (hopefully, no tricks), and there will be gifts for both parties when this day is done.
This "day," however, is expected to carry on for several days given the extended time it takes in some states to count votes for House races. The market knows this, but it will be taking its trading cues from the known results rolling in tonight, not only for the Congressional races but also for the presidential race, which itself has the potential to carry on a bit longer than usual, particularly if any recounts are necessary.
The market knows the latter as well. It is anxious about that possibility, but also hopeful that it can be avoided.
Since polling locations won't close until after the market closes, today's trading will be more about gamesmanship. It is Wednesday's session where the rubber of the election results will start to hit the road.
For now, the equity futures market, the Treasury market, and the dollar are following a fairly even keel.
The S&P 500 futures are up 13 points and are trading 0.2% above fair value, the Nasdaq 100 futures are up 73 points and are trading 0.4% above fair value, and the Dow Jones Industrial Average futures are up 56 points and are trading 0.3% above fair value. The 2-yr note yield is up one basis point to 4.19% and the 10-yr note yield is up one basis point to 4.32%. The U.S. Dollar Index is down 0.1% to 103.75.
There has been a decent amount of earnings news since yesterday's close. We'll call the reaction to that news "mixed."
Some of the winners include Palantir Technologies (PLTR), DuPont (DD), and Global Foundries (GFS). Some of the losers include Cirrus Logic (CRUS), NXP Semiconductors (NXPI), Lattice Semiconductor (LSCC), and Wynn Resorts (WYNN).
These will be story stocks along with Boeing (BA), which is up 1.6% after its machinists union voted to ratify the new contract proposal.
The main story, though, is the election. That will overshadow all else in today's market conversation, including the Reserve Bank of Australia leaving its policy rate unchanged at 4.35%, as expected, the $42 billion 10-yr note auction at 1:00 p.m. ET, and today's economic data that will feature the ISM Services PMI (Briefing.com consensus 53.5%; prior 54.9%) at 10:00 a.m. ET.
The September Trade Balance Report at 8:30 a.m. ET showed a widening in the trade deficit to $84.4 billion (Briefing.com consensus -$74.0 billion) from a revised $70.8 billion (from -$70.4 billion) in August. That widening was the result of exports being $3.2 billion less than August exports and imports being $10.3 billion more than August imports.
The key takeaway from the report is that the imbalance between exports and imports is indicative of a U.S. economy that is running stronger than its global counterparts.
