Daily Market Color

Consumer Data and Debate Push Markets Higher Despite Falling Oil Prices

US stocks began the day higher in response to last night’s presidential debate that was perceived by pundits as a victory for Hillary Clinton.  Adding to the positive market sentiment, the Consumer Confidence Index for September jumped to 104.1, exceeding expectations of 99.0 and posting the highest mark since the recession.  The report prompted discretionary stocks to rise more than 0.8% throughout the day, a welcomed change to the 2.5% fall experienced by the discretionary index over the past couple months.  The momentum generated from the presidential buzz and consumer confidence stood as enough to offset the tumble in energy prices that weighed on markets.  In Algiers, with the OPEC meeting set to conclude tomorrow, officials from Saudi Arabia and Iran gave markets an indication that a supply agreement would not be reached.  Saudi Energy Minister Khalid al-Falih asserted that the focus of the gathering is not on completing a deal, and stated “This is a consultative meeting … We will consult with everyone else, we will hear the views, we will hear the secretariat of OPEC and also hear from consumers.”  Iranian Oil Minister Bijan Zanganeh echoed a similar attitude to reporters in saying he is looking forward to the OPEC meeting in November to reach an agreement, and that “It is not the time for decision-making.”  The officials’ comments pushed oil down roughly 2.75% for the day.  

Internationally, Deutsche Bank’s liquidity concerns continued to weigh on European markets after the bank’s share price produced a new record low for the second day in a row, down an additional 0.4%.  European equity markets finished negative on the day with German Bund yields falling deeper into negative territory as the 10-year yield closed at -0.143%, marking its lowest level since July.  The euro was also down near 0.50% against the US dollar on the day, falling to $1.1196/euro.  In Mexico, the peso gained 2% against the dollar as it recovered from record lows that were driven by the U.S. presidential race evening out prior to last night.  Investors view a potential Trump presidency as a significant risk to global markets given his rhetoric surrounding re-negotiations of international trade deals.  
All three major U.S. stock indexes are currently up 0.5%-0.8% on the day while Treasury yields/swap rates are up 0-4 bps across the curve.  WTI crude oil closed down $1.25 to $44.65/barrel, and Brent crude fell $1.40 to nearly $46/barrel.

Ready to start a conversation?

We offer free consultations and platform demos.

Let's Talk