Mike’s Morning Brief – October 4, 2017

Mike Frazier portrait headshot

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Market opens flat with all 4 major US indices closing yesterday at fresh, new highs.  The S&P has been up 6 straight days. Small Caps have been strong of late after a period of weakness over the summer. What’s leading? What’s following?  Financials for sure have taken charge. Energy is taking a breather after a monster move. Transports have been strong of late, and the Airlines soared yesterday. Tech and HC have gone sideways the last few weeks but remain the top 2 sectors on the year. The rally has broadened out.  That’s a good thing. But it feels like it’s on fumes. It’s not normal and healthy for this upward trajectory not to have some back and filling.  There are plenty of things out there that can derail this rally.  Puerto Rico bonds are taking a hit after President Trump suggested the territory’s heavy debt needs to be wiped clean, and don’t have the cash, which is confusing many. The President heads to Las Vegas today. There is a rumor circulating that Amazon might buy Nordstrom. The European Commission is pressing Ireland on money not being collected from Apple. There is a growing chance that Spain actually sees a split. Fed Chair Janet Yellen has a speaking engagement today, which always draws attention. But now that there are 2 candidates that seem to be rising in the ranks of getting her job in February, investors will be paying more attention. The US economy strengthened last Qtr, printing a 3.1% increase.  Friday’s job report combined with the beginning of Earnings Season will tell us a lot about where we’re headed. Pepsi missed expectations and the stock is feeling some pain.  Interest rates are slightly lower in early trading. Both Gold and Oil are catching a bid this morning. WTI is still holding that key $50 level. September usually sees declines and October sees increased volatility. So far there’s been next to none. This Bull just doesn’t want to go down. But for how much longer? Stay tuned…

Have a great morning,

Mike Frazier

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