A daily market update from FS Insight — what you need to know ahead of opening bell
“On Halloween night, the Great Pumpkin rises from his pumpkin patch and flies through the air with his bag of toys to all the children.” –It’s The Great Pumpkin, Charlie Brown
Overnight
Typhoon Kong-rey makes landfall in Taiwan NYT
US GDP rose at a 2.8% rate in third quarter on strong consumer spending FT
Switzerland is now flirting with deflation, causing a dilemma for its central bank CNBC
Eight out of 11 Supreme Court justices in Mexico to resign ahead of contentious election NYT
Microsoft reports quarterly sales up 16% to $65.6 billion as investors ask if AI spending worth it AP
Meta misses on user growth, warns of 2025 jump in AI spending CNBC
Coinbase stock dives on earnings miss as Bitcoin nears record highs IBD
EU fines generic drugmaker Teva for hindering competition FT
Novo Nordisk’s Ozempic and Wegovy now available in the U.S. after shortages, FDA says CNBC
China’s BYD overtakes Tesla revenue for first time BBC
Super Micro stock in free fall after accountant resigns BAR
Trafigura warns of up to $1.1bn loss over Mongolian oil scandal FT
Airbus delivers first extra-long-range Airbus A321 as smaller jets fly farther CNBC
H5N1 bird flu identified in pig for first time in United States CNN
Russia fines Google $2.5 decillion (2.5 trillion trillion trillion dollars) IND
Chart of the Day
| Overnight |
| S&P Futures -48
point(s) (-0.8%
) Overnight range: -51 to -8 point(s) |
| APAC |
| Nikkei -0.5%
Topix -0.3% China SHCOMP +0.42% Hang Seng -0.31% Korea -1.45% Singapore flat Australia -0.25% India -0.57% Taiwan flat |
| Europe |
| Stoxx 50 -0.77%
Stoxx 600 -0.76% FTSE 100 -0.72% DAX -0.6% CAC 40 -0.77% Italy -0.35% IBEX -0.38% |
| FX |
| Dollar Index (DXY) +0.05%
to 104.04 EUR/USD +0.04% to 1.086 GBP/USD +0.04% to 1.2967 USD/JPY -0.7% to 152.34 USD/CNY +0.04% to 7.1188 USD/CNH +0.01% to 7.1263 USD/CHF -0.15% to 0.8654 USD/CAD +0.12% to 1.3921 AUD/USD -0.05% to 0.6569 |
| Crypto |
| BTC -0.74%
to 72293.43 ETH -1.58% to 2636.28 XRP -1.11% to 0.519 Cardano -0.58% to 0.357 Solana +0.03% to 174.87 Avalanche -1.31% to 25.83 Dogecoin +1.3% to 0.1719 Chainlink -1.47% to 12.08 |
| Commodities and Others |
| VIX +7.17%
to 21.81 WTI Crude +0.57% to 69.0 Brent Crude +0.43% to 72.86 Nat Gas -1.48% to 2.8 RBOB Gas -0.08% to 1.994 Heating Oil +0.48% to 2.198 Gold -0.3% to 2779.26 Silver -0.44% to 33.63 Copper +0.26% to 4.363 |
| US Treasuries |
| 1M -1.1bps
to 4.7273% 3M -0.8bps to 4.5677% 6M -0.6bps to 4.4667% 12M -1.1bps to 4.2688% 2Y -0.8bps to 4.1744% 5Y -0.2bps to 4.1599% 7Y -0.5bps to 4.2213% 10Y -0.6bps to 4.2944% 20Y -0.8bps to 4.612% 30Y -1.0bps to 4.4936% |
| UST Term Structure |
| 2Y-3
M Spread narrowed 1.3bps to -41.2
bps 10Y-2 Y Spread widened 0.2bps to 11.6 bps 30Y-10 Y Spread narrowed 0.2bps to 19.9 bps |
| Yesterday's Recap |
| SPX -0.33%
SPX Eq Wt -0.22% NASDAQ 100 -0.79% NASDAQ Comp -0.56% Russell Midcap +0.02% R2k -0.23% R1k Value -0.11% R1k Growth -0.46% R2k Value +0.08% R2k Growth -0.53% FANG+ -0.32% Semis -2.43% Software -0.23% Biotech -0.14% Regional Banks +1.01% SPX GICS1 Sorted: Comm Srvcs +0.99% Fin +0.42% REITs +0.39% Materials +0.37% Energy +0.04% Cons Disc +0.01% Healthcare -0.19% Indu -0.19% Utes -0.24% Cons Staples -0.26% SPX -0.33% Tech -1.34% |
| USD HY OaS |
| All Sectors -10.2bp
to 327bp All Sectors ex-Energy -9.3bp to 304bp Cons Disc -9.9bp to 280bp Indu -8.8bp to 241bp Tech -8.9bp to 318bp Comm Srvcs -13.2bp to 524bp Materials -10.0bp to 300bp Energy -11.0bp to 313bp Fin Snr -7.9bp to 287bp Fin Sub -5.3bp to 204bp Cons Staples -8.8bp to 311bp Healthcare -11.3bp to 366bp Utes -9.0bp to 210bp * |
| Date | Time | Description | Estimate | Last |
|---|---|---|---|---|
| 10/31 | 8:30AM | Sep PCE m/m | 0.2 | 0.1 |
| 10/31 | 8:30AM | Sep Core PCE m/m | 0.27 | 0.13 |
| 10/31 | 8:30AM | Sep PCE y/y | 2.1 | 2.2 |
| 10/31 | 8:30AM | Sep Core PCE y/y | 2.6 | 2.67847 |
| 10/31 | 8:30AM | 3Q ECI QoQ | 0.9 | 0.9 |
| 11/1 | 8:30AM | Oct AHE m/m | 0.3 | 0.4 |
| 11/1 | 8:30AM | Oct Unemployment Rate | 4.1 | 4.1 |
| 11/1 | 8:30AM | Oct Non-farm Payrolls | 101.0 | 254.0 |
| 11/1 | 9:45AM | Oct F S&P Manu PMI | 47.8 | 47.8 |
| 11/1 | 10AM | Oct ISM Manu PMI | 47.6 | 47.2 |
| 11/4 | 10AM | Sep F Durable Gds Orders | n/a | -0.8 |
| 11/5 | 8:30AM | Sep Trade Balance | -73.5 | -70.431 |
| 11/5 | 10AM | Oct ISM Srvcs PMI | 53.3 | 54.9 |
| 11/6 | 9:45AM | Oct F S&P Srvcs PMI | n/a | 55.3 |
MORNING INSIGHT
Good morning!
Our client survey shows that 75% of clients see the election results delayed, with the plurality seeing the winner declared more than a week after Nov 5th.
Click HERE for more.
TECHNICAL
- SPX is choppy near-term but likely pushes up into early November before a peak.
- Breadth readings per SPX Members above 10-day m.a. have plummeted lately.
- MSFT and LLY technical analysis given their earnings and volatility lately.
Click HERE for more.
CRYPTO
The anticipated MicroStrategy BTC bid and an array of broader macro factors support the bullish case for crypto.
Click HERE for more.
First News
With the election less than a week away, much has been written about how unreliable polls have become. Fundstrat’s Washington Policy Analyst Tom Block has told us that in his conversations, polling professionals who have worked with both major parties are frustrated by the effects of the near-elimination of residential landlines. It has become increasingly tough to get potential voters to answer the phone when Caller ID shows an incoming call from an unfamiliar number, and perhaps just as importantly, it has become difficult to reliably assess where the participant lives and will vote. As Block notes, someone with, say, a Connecticut area code is no longer necessarily a Connecticut resident or registered voter.
Betting markets have helped fill in the gap, providing a new source of information about public opinion. Real Clear Polling lists eight markets in which people can place bets on the Presidential contest, and the app-based brokerage Robinhood recently announced its entry into the field. Proponents assert that because people are putting their own money on the line, the resulting betting odds might in fact be a more reliable gauge of public opinion. Critics counter that in aggregate, those placing bets are not necessarily representative of U.S. voters as a whole – perhaps skewing male, and perhaps comprised of a significant number of non-Americans. And of course, there’s a difference between betting on who one believes will win and betting on the candidate for whom one intends to vote. The two are not necessarily the same.
Perhaps for political polling, as for so many other challenges these days, AI might have the answer? Some suggest that there’s no need to ask actual people for their political opinions, when AI can scour the Internet – social media, chat rooms, etc. – and use analytics to glean insights about evolving public opinion.
A second option involves using AI chatbots to conduct polls. This makes it possible to attempt to poll much larger pools of potential respondents without hiring huge numbers of human pollsters. Furthermore, some researchers suggest that AI-conducted polls could be superior when sensitive or controversial topics like abortion are involved: Respondents might be more willing to provide honest responses if they know that they aren’t interacting with an actual human being.
Still others are experimenting with using pools of AI agents or personas that have been trained on datasets to simulate actual human beings with specific demographic, economic, geographic, and sociopolitical characteristics, and then simply using them as artificial polling participants. The obvious advantage to this approach is that an AI agent will always be willing to “answer the phone” and provide an honest – albeit synthetic – opinion about any issue or question put forth.
That’s what the startup called Aaru did ahead of the Democratic primary for New York’s 16th Congressional District, in which George Latimer defeated incumbent Jamaal Bowman by 45,909 to 32,440. Aaru correctly predicted the winner, projecting that Latimer would get 58.7% of the votes to 41.3% for Bowman. The actual result? 58.6% to 41.4%. What’s more, Aaru’s “polls” can be conducted in under two minutes and at a significantly lower cost.
Ultimately, however, regardless of what AI can do, the most important poll will take place across the U.S. on November 5. SEM, HKS, SN
