Good Morning on this fantastic best day of the week, Wednesday,
Overnight and early a.m. it looked like equity markets were going to falter a bit. The Dow was down 250 and worsening. Then a report came out that Pfizer (pharmaceutical company) is having positive results with their Covid vaccine trials. Markets can’t wait for this type of news, as it signals the all clear to take the already bloated equity markets even higher. The Dow turned that frown upside down and quickly went positive. Bond traders, who are always more pensive and quite a bit smarter, are holding firm. Both the 10-yr and mortgage bonds are unchanged on the day. The ADP payrolls number was far below expectations, but markets have shrugged that off, along with other weak data releases (construction spending and Chicago PMI), as Covid news and how the economy will rebound is the only focal point for markets currently. Even Dr. Fauci’s dismal and dark warnings about the spike in cases are quickly laid to rest by Messrs. Mnuchin and Powell testifying the Fed and Treasury will backstop everything forever. We should all feel better now. The BLS jobs report which is the biggest economic report of the month and is typically released the first Friday will, due to the holiday, be released tomorrow- a day earlier. Markets do not know what to expect as the math was very fuzzy for last month’s report. I would anticipate tomorrow with the holiday shortened trading day/week will be volatile. If you are looking to be safe, I do think today is a good day to lock.
Please remain safe and stay healthy, make today great!