Morning Update: Stocks rise on trade optimism

First Look

Stocks are again pointed higher ahead of the open Wednesday. Whether or not this overnight rally, like several that have come before, will get sold when the market opens remains to be seen. Today’s optimism seems to stem from fresh trade optimism after Huawei’s CFO was granted bail in Canada, although she still faces extradition to the U.S. On that front though, President Trump said yesterday that he would consider intervening in the matter if would be a productive contribution toward a trade deal with China. While that demonstrates Trump’s willingness to work toward a deal, it undermines the credibility of various members of his administration who have repeatedly said the arrest is entirely separate from trade negotiations. Trump also said yesterday that he would gladly shut down the government as part of a negotiation for funding for a border wall. Any shutdown, which could come as soon as next week, would only be a partial shutdown under the terms of the existing budget agreement. The Nasdaq is up 1.14%, the Dow Jones is up 0.95%, the S&P 500 is up 0.93%.

Today's market outlook is Neutral

The best revenge is massive success.
Frank Sinatra

Stocks on the Move

IPG Photonics Corporation (IPGP), United Rentals, Inc. (URI) and Linde PLC (LIN) are moving higher this morning, while Verizon Communications Inc. (VZ), eBay Inc (EBAY) and Fluor Corporation (NEW) (FLR) are headed lower. Royal Bank of Canada (RY), Pioneer Natural Resources (PXD) and Lululemon Athletica inc. (LULU) were upgraded by analysts this morning, while American Tower Corp (AMT), Hyatt Hotels Corporation (H) and Goldman Sachs Group Inc (GS) were downgraded.

International Markets

Stocks in Asia are up. The Nikkei 225 is up 2.15%, the Hang Seng is up 1.53%, the Australia ASX All Ordinaries is up 1.35% the Mumbai Sensex is up 0.54% and the Shanghai SE Composite Index is up 0.31%. In Europe stocks are up. The CAC 40 is up 1.9%, the Euro Stoxx 50 is up 1.59%, the FTSE 100 is up 1.26% and the DAX is up 1.2%.

Futures and Currencies

Energy futures are mixed today. The price for West Texas Intermediate crude oil is up 1.01 at 52.66 per barrel. Brent crude is up 1.04 at 61.24 per barrel. Natural Gas is down -0.15 at 4.26. Precious metals are up this morning. Gold is up 1.66 at 1244.91 per ounce. Platinum is up 6.51 at 792.07 while silver is up 0.13 at 14.76. The dollar is down compared to the major currencies today. The greenback is down against the euro, down against the Yen and down against the Pound.

Put/Call Ratio

Yesterday, 663,800 call contracts traded on the Chicago Board Options Exchange (CBOE) compared to 431,283 put contracts. The single-session put/call was 0.65 while the 20-day moving average is now at 0.71.

Earnings Expected Today

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Today's Economic Calendar

What's Happening Period Release Time
MBA Mortgage Applications Index 12/08 07:00
CPI Nov 08:30
Core CPI Nov 08:30
EIA Crude Inventories 12/08 10:30
Treasury Budget Nov 14:00

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