Good morning. Trifecta. Heard the term? No, I’m not talking about the horserace track. I’m talking about U.S. equities. Specifically, a Dow Trifecta. That’s when the Dow Industrials, the Dow Transports and the Dow Utilities all close at record highs. Yesterday the Dow jumped 101 points closing at 17,485. The Dow Transports rose 0.47% and the Dow Utilities ended up 2.03%. This is indeed a very rare occurrence. This is only the 26th time in history these three averages all concurrently closed at record highs. The last time this happened was April 25, 2007. Now here’s something even rarer! The S&P 500, which advanced 11 points to 2,024, also closed at a record high. The last time this benchmark and the Dow averages hit records was more than 16 years ago! Rounding out the data, the Nasdaq lost 3 points to 4,621. The Dow has now set a record high 20 times this year and the S&P 36 times this year. Oorah! Investors welcomed the results of the mid-term elections and bought shares yesterday in companies with strong earnings and for the first time in about 5 weeks, energy sector stocks with oil prices bouncing. Regardless of the elections, the U.S. economic picture is improving and 3rd quarter corporate earnings have been good. Also helping stocks was ADP’s monthly private-sector employment report showing companies added 230,000 jobs last month exceeding forecasts. It’s the 6th month in 7 that private-sector hiring has topped 200,000. This sets the stage for THE big report which will come tomorrow when the Labor Department releases its Employment Situation Report for October. The Institute of Supply Management’s reading on the U.S. service sector for October came in short of expectations but remains above 50 which indicates expansion. The ISM nonmanufacturing purchasing index slowed to 57.1 from 58.6 in September also missing forecasts but still well above 50.

The Asian markets closed mixed with the Nikkei pulling back from consecutive record highs and the European bourses all trading on either side of unchanged. The ECB met today and those indexes initially popped on ECB President Mario Draghi’s comments reiterating that the Governing Council stands ready to use unconventional easing measures if need but have pulled back because it’s all still “hot air” and there’s still no action. The Dow is mimicking European equities trading flat to yesterday’s close.

Oil finally found a bid yesterday with WTI closing up $1.49 at $78.88, however Brent only managed to eke out a 13¢ gain to $82.95. WTI popped on the release of the EIA’s weekly crude and products report. Expectations were for an aggregated decline of 700,000 bbl with the actual a surprising draw of 1.642 million bbls. WTI’s gain was in the face of a strong head wind with the U.S. dollar hitting another 7 year high vs. the yen and also going higher against the euro.

Folks are coming in this morning realizing that although the EIA’s report was bullish there’s plenty of oil out there and the bears once again have come out of their caves pushing WTI lower $0.97. The Saudi’s have the U.S. shale producers in their cross hairs and are want to take WTI’s price to a level that will reduce capital budgets. In between 2002 and 2012 Saudi Arabia’s production levels had a material influence on price. But look at the chart below. “Saudi America’s” production is now materially greater than Saudi Arabia’s.

Courtesy of MDA Information Systems LLC

Natural gas prices just keep climbing higher. Yesterday the November contract closed up 6.5¢ at $4.194. Natty prices have zoomed up more than 75¢ in just 7 trading sessions to a 4 month high. It’s all about the weather and the forecast has been cold and keeps getting revised colder. Today is EIA natural gas storage day and the market is expecting an injection of 88 Bcf. This compares to last year’s injection of 25 Bcf and the 5 year average of 42 Bcf.

This morning natty is down 3.7¢.

Have you heard of Nuri? No, it’s not a sushi bar. It’s a typhoon in the western Pacific Ocean and happens to be one of the two strongest storms on Earth so far this year. It’s off the coast of Japan and thankfully heading northeast and will not hit the island. So what’s the significance of this typhoon? Well it’s so strong that according to computer models it is destined to transform into a monster storm near Alaska, possibly one of the strongest the western part of the state has ever seen! And it’s effects will be felt all the way to the U.S. east coast. The storm’s energy is so great it’s causing the jet stream to be amplified with a big peak in the western U.S. and a big trough in the east which is allowing the cold arctic air to penetrate deep into the eastern part of the country in the 6-15 day time frame (see map). It’s going to be downright cold for everybody east of the Rockies in the 6-10 time frame with cities from Chicago to Houston experiencing temperatures 17 degrees below normal! Sounds like a great time to stoke up the fireplace and have a hot toddy! Have a good day.