MARKETS GIVE A POST-DEBATE SIGH OF RELIEF

September 30, 2020

HCM-BuyLine® The debate last night, in our opinion, did not change any minds. Like I stated yesterday in an interview with the Wall Street Journal (linked below), 99.9% of voters have made up their minds on who they are voting for. I will say that the open of today’s market looks like there is a sigh of relief after the debates as investors can see light at the end of this presidential election, and I feel that is why the market is firming up this morning.

The three major stock indexes are all trading above their 50-day moving average lines. That strengthens their short-term trend and puts them in position to regain some ground lost during the month of September. That strong action is matched by all eleven market sectors gaining ground today, with the biggest gains in financials, energy, industrials, consumer cyclicals, and materials. Small cap stocks are having an unusually strong day as are transportation stocks. 

SP 500

The Conference Board’s Consumer Confidence Index jumped 15.5 points in September, the most since April 2003, to 101.8, well above the consensus of 90.1. It was led by a 17.4-point gain in consumer expectations, the most since May 2009, on notable improvement in the outlook for future business conditions and jobs. Income expectations, however, were flat. Consumers’ assessment of the present situation also picked up.

Confidence increased across all demographic and nearly all income groups. It also rose in eight of the nine Census regions. The broad-based improvement boosted purchasing plans for the next six months. Plans to buy a car, a home, or major appliances all increased, in contrast to a negative seasonal tendency this time of year.

New home sales increased 4.8% in August, its fourth consecutive gain, to a 1.011 million unit annual rate, the highest level since September 2006. The consensus was for a 0.3% decline to an 898,000 unit rate. Sales are up 43.2% from a year ago, near its fastest year-over-year pace since 1992. Monthly sales growth was mixed by region, but all four regions posted double-digit year-over-year gains. Sales have spiked amid record low mortgage rates, making the housing market a bright spot in the COVID-stricken economy. 

This week Vance was quoted in the Wall Street Journal, NASDAQ, and ETF Trends. Click the links below to view the full articles. 

Wall Street Journal           NASDAQ             ETF Trends

 

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