Government shutdown? Looming debt ceiling debate? With all the headlines this morning, one would think it would be an ugly day for U.S. equities. How can the market be up with all these headwinds? Well it was, and it was a strong rally. Some of the strength can be attributed to the ISM report showing the most growth in 2 1/2 years. Gold was pressured after the report and headed near 2 month lows.
Folks think the shutdown will have a minimal effect on GDP as long as it last for less then a week, and that soothed the recent fears.
The Debt Ceiling seems to be the bigger egg to fry, lets hope our elected officials have a nice spatula and some non-stick pans.
Some huge movers today including: NFLX, YELP, CREE, PCLN, SHLD, SINA, UNXL, DUST, and others.
So where are we headed tomorrow? Well looks like the ADP report will be out for Thursday, but that will only be an appetizer compared to the much anticipated September Jobs report. Maybe it was Big Ben and Obama’s plan all along to have the shutdown to delay these numbers, as it looks like they will not be released pending any quick resolution to the shutdown : http://www.usatoday.com/story/money/business/2013/09/30/jobs-report-government-shutdown/2897563/
The SPY sure looks poised to retake $170, whether that happens Wednesday or Thursday, I put a 75% chance of it happening.
The VIX continues to scream reversal:
- JB