After the move higher on Friday afternoon, stocks opened up higher still this morning, with the S&P moving back above 6,700. The move higher is broad-based, with only consumer staples in the red. The VIX has moved down from 21 to below 19. A White House spokesperson suggested this morning that the government shutdown could end this week.
Earnings are quiet today, but it’s a very big week. Tomorrow, we get Netflix (NFLX), GE Aerospace (GE), Coca-Cola (KO), and Philip Morris (PM). Wednesday is Tesla (TSLA), IBM (IBM), and AT&T (T). Outside of bad loan issues at a couple of regional banks, the earnings so far have been very bullish in general.
On the commodity front, gold is higher, up 3%, headed to yet another new all-time high. People are now calling for a run to $5K by year’s end. Central bank buying of gold is seen as a diversification away from the US dollar, but it’s ETF buying that has driven the latest moves higher.
Silver is back above $51/oz, and there are rumors of a shortage of physical delivery against contracts here. Copper is hovering above $5/oz. Crude oil dipped briefly below $56/bbl, the lowest since 2020. Natural gas has climbed back above $3.25/mcf. Crypto is modestly higher today, with Bitcoin at $111.2K, up from below $106K just last Thursday.
Interest rates are essentially flat today, with the US 10-year holding at 4%. International bond rates are largely flat as well. Bets for a rate cut in December to 3.5% are now 98%, and another cut in January has risen to 59%, and a further cut in March to 31%. The US dollar index is holding above 98.25.
Momentum remains positive and has now become earnings-driven, which should propel the market into year-end, outside of any Black Swan events.
