Here is a look at what brought the world to its knees, plus what you need to know about today’s trading.
This Brought The World To Its Knees
October 24 (King World News) – Art Cashin: On this day in 1918, the world-wide flu epidemic went into high gear in the U.S. In New York City nearly 200 people died in one day. In Boston about 150 died, and in Philadelphia a few days later over 500 folks died within a 24 hour period. On a single day in Chicago over 400 died. The flu was one of the worst and fastest killing ever. There were tales of folks leaving work early with signs of the flu and dying before the trolley got them home. There was real panic. Schools, theaters and sports events were closed (often by law – more frequently, due to a fearful public not attending). The New York City Health Commissioner tried to pass a law that people could kiss only when wearing masks. In many cities, police walked the streets with handkerchiefs over their faces (making cops look like robbers).
And the dying continued, all around the world. In a little over twelve months, over twenty-five million people died. When the pandemic finally ended, it is estimated over 50 million people died. In the army, during WWI, more soldiers were killed by the flu than were killed in combat.
Ironically, although it was called the Spanish Flu it probably started in Kansas. And, as infected troops moved from country to country, it got more virulent, deadly and widespread. And at war’s end, the political leaders of the world hastily signed an imperfect armistice — because they all had “the flu”.
Pre-opening Wednesday morning, U.S. stock futures looked like they might be coming down with the flu. Several earnings reports were less than glowing and some of the outlooks were cloudy.
But, when it was time for the opening bell to ring, traders were looking past the negatives.
A good example was Boeing. Its earnings were far below expectations and initially the stock fell. But, traders began to suspect that this might be a “kitchen sink” quarter, where management was writing off as much as it could. The company also suggested that the 737 Max could be recertified before the end of the year. That overall reassessment turned the stock to the plus side.
The bulls tried to build on the opening rally throughout the morning. Initially, they moved into the large caps and multinationals. That made the Dow the standout index for much of the morning. When the Dow was unable to
punch past Tuesday’s intra-day highs, the bulls seemed to shift their primary rally vehicle to the S&P.
While the bulls kept pushing the rally try throughout the day, it was hardly a one-way street. Several times during the session, one of the indices dipped into mild negative territory.
In the final hour, the bulls did manage to regroup and they rallied into the closing bell.
They never managed to beat, or even meet, the prior day’s highs but once again, the underlying breadth was solid with advances beating losers by almost two to one.
The continuing strength in the advance/decline line (series of new highs) strongly suggests that the bulls are still likely to challenge the highs.
Another factor helping the bulls was a wave of strength in the energy stock as the price of crude moved up on bullish inventory data.
Overnight And Overseas – Asian equity markets closed mixed. Tokyo and Hong Kong saw moderate rallies, while Shanghai and India had fractional selloffs.
In Europe, markets are generally better. London is having a solid rally with somewhat more moderate gains in Paris and Frankfurt.
Among other assets, Bitcoin continues to struggle, trading just under $7500. Gold is a shade lower and crude is backing off yesterday’s rally. WTI is trading around $55.60. The euro is flat against the dollar and yields are a tick, or two, lower.
Consensus – It will be another big day for earnings. Among those reporting will be Amazon, Intel, Comcast, Twitter and Visa.
Mario Draghi’s farewell press conference. Likely to say things would have been much worse if the ECB had not acted as aggressively.
Several European banks are said to be rethinking the idea of negative rates.
Stick with the drill – stay wary, alert and very, very nimble.
$100 Billion Of Liquidity Injections
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James Turk’s powerful audio interview has now been released where he discusses exactly what to look for in the gold and silver markets, mining shares, the coming crisis, the U.S. launching QE4 and much more, and you can listen to it immediately by clicking here or on the image below.
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