The Morning Call--More reasons for a market melt up

 

The Morning Call

 

10/26/22

 

 

The Market

         

    Technical

 

            Tuesday in the charts

            https://www.zerohedge.com/markets/surging-crypto-swap-spreads-bonds-stocks-signal-somethings-afoot

 

            No defensive rotation.

            https://allstarcharts.com/chart-of-the-day-no-defensive-rotation/

 

            Don’t fight Santa Claus after the mid-term elections.

            https://www.yardeniquicktakes.com/mid-term-elections-tend-to-be-bullish/

 

            Yet another reason for a stock/bond market melt up.

            https://www.zerohedge.com/markets/people-are-increasingly-anticipating-something-market-about-be-shocked-treasury-buyback

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

                          

Weekly mortgage applications declined 1.7% while purchase applications were down 2.3%        

                          

                          October consumer confidence was 102.5 versus consensus of 106.5.

 

The October Richmond Fed manufacturing index was -10 versus   predictions of +2.                  

 

                        International

 

August Japanese leading economic indicators came in at 101.3 versus estimates of 100.9.

 

                        Other

 

                          A lesson in trade.

                          https://www.adamsmith.org/blog/we-do-seem-to-have-a-certain-problem-here

 

                          Data suggest a rebound in Q3 GDP, but then a downturn in Q4.

                          https://www.capitalspectator.com/us-q3-growth-is-set-for-rebound-in-thursdays-gdp-report/

 

                          IEA chief says world in global energy crisis.

                          https://www.cnn.com/2022/10/25/energy/global-energy-crisis-iea-fatih-birol/index.html

 

            The Fed

           

              The Fed is losing billions.

              https://www.bloomberg.com/news/articles/2022-10-25/fed-is-losing-billions-wiping-out-profits-that-funded-spending?srnd=premium&sref=loFkkPMQ

 

              The Bank of Japan’s monetary policy is broken.

              https://www.zerohedge.com/markets/one-bank-makes-stunning-discovery-bank-japans-ycc-broken-and-soon-entire-jgb-market-will

 

            Inflation

 

              The cost of Campbell’s tomato soup keeps rising.

              https://politicalcalculations.blogspot.com/2022/10/cost-of-campbells-tomato-soup-keeps.html#.Y1ghZ3bMKUk

 

            The coronavirus

 

              The cost of the covid shutdown.

              https://www.powerlineblog.com/archives/2022/10/the-costs-of-covid-shutdowns-part-2.php

 

              The CDC fails to protect you---again.

              https://www.nakedcapitalism.com/2022/10/cdc-in-yet-another-data-debacle-fails-to-protect-you-by-butchering-reveal-of-covid-escape-variant-bq-1.html

 

     Bottom line

 

            One sign bond investors are prepping for a recession.

            https://www.axios.com/2022/10/24/bond-investors-downturn-preparation

 

    News on Stocks in Our Portfolios

 

Canadian National Railway press release (NYSE:CNI): Q3 GAAP EPS of C$2.13 beats by C$0.12.

Revenue of C$4.51B (+25.6% Y/Y) beats by C$190M.

 

Canadian National Railway (NYSE:CNI) declares CAD 0.7325/share quarterly dividend, in line with previous.

 

Microsoft press release (NASDAQ:MSFT): Q1 GAAP EPS of $2.35 beats by $0.06.

Revenue of $50.1B (+10.6% Y/Y) beats by $410M

 

General Dynamics press release (NYSE:GD): Q3 GAAP EPS of $3.26 beats by $0.12.

Revenue of $10B (+4.5% Y/Y) beats by $70M.

 

Automatic Data Processing press release (NASDAQ:ADP): Q1 Non-GAAP EPS of $1.86 beats by $0.07.

Revenue of $4.2B (+9.7% Y/Y) beats by $40M.

 

What I am reading today

 

            Comedy wildlife photo finalists.

            https://www.theguardian.com/world/gallery/2022/oct/20/comedy-wildlife-photo-finalists-in-pictures

 

 

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