Yahoo Finance Stocks are beating October's bad rap
By Alan Valdes, director of floor operations at Silverbear Capital
So much for October being a bad month for the market. As of today, October is turning into a nice surprise. Both the S&P 500 (^GSPC, SPY) and the Dow (^DJI, DIA) are coming in with all-time record highs. The Dow and the Nasdaq (^IXIC, QQQ) are ahead of their September gains. The markets, which have added $5 trillion in value since the election, seem set to add more to their impressive 63 new all-time highs.
Add to that the possibility of a tax bill, which could cut middle class taxes and bring a reduction in the corporate tax rate to 20% (which the president said is not negotiable). The result would bring back trillions of overseas dollars back to U.S.corporate coffers. A successful passage through Congress and approval before 2018 could move the Dow up another 500 points before the cherry blossoms bloom in the National Mall this spring.
Traders took a while to digest yesterday’s FOMC minutes and seemed a little confused, as the market traded sideways in a very narrow range in the initial hours after the release. At the end of the day, the bulls finally got their footing as roughly $500 million came in to buy on the bell, closing the Dow at 22,872.89 and the S&P at 2,555.24—both all-time highs.
Today, markets are taking a little breather as traders book some profits before earnings season starts in earnest. That said, we did get some bank earnings before the bell. JPMorgan (JPM) reported 3Q beats in both earnings and revenue, surpassing analysts’ expectations. But the bank also reported a 27% decline in year-over-year fixed income trading revenue. Citigroup (C) also beat 3Q expectations, and similar to JPMorgan, Citigroup’s bond trading revenues were down 16% year over year. Friday, we get earnings’ reports from Bank of America (BAC) and Wells Fargo (WFC).
So far the Halloween month has been more of a treat than a trick!
