Equities and the Economy:

For the 8th consecutive session the S&P 500 closed lower yesterday posting a 9 point loss finishing at 2,089. This is the S&P’s longest losing streak since the 2008 financial crisis. The Dow lost 29 to end at 17,931 and the Nasdaq fell 47 points, 0.92%, at 5,058. Before you panic though, and as I stated in yesterday’s Blog, the cumulative loss has been minor, about 2.5%, and this is off record highs. The S&P is still up 2.2% y-t-d. Recently, though, it’s been Chinese water torture: drip, drip, drip. You can see the angst in the general market. CNN’s Fear and Greed Index  is way down to 15, Extreme Fear. It’s been a long time since we’ve been this low, February. For you traders out there, history has shown that when this index falls below 20 stocks are getting into oversold territory. However, there is a caveat. Overlaying this index with the S&P shows that the Fear and Greed index leads the S&P by about 2 weeks and the bottom is not signaled until the F&G Index turns higher. At least this is how it’s been for the last 2 years. Back to the S&P index, technically, we’ve broken support. Looking at the long term trend line dating back to late Feb/early March of this year, 2,120 was support. (Now you regular readers may say “You previously said 2,100 was support. And you are correct. However, the trend line is upward sloping from the bottom left to the upper right raising the number every day). This all setting up for a bounce. Maybe on Wednesday.

Regarding economic data, yesterday the Labor Department released its weekly initial jobless claims report noting they rose by 7,000 last week to 265,000. This came in right at economists’ expectations. Of note, claims have been under 300,000 now for 87 consecutive weeks, and setting a new record every week. Moving on, the Institute of Supply Management reported its index of service sector activity fell from 57.1 in September to 54.8 in October. Although lower, this is the 87th consecutive month of growth. As for good news, the Labor Department reported U.S. worker productivity rose at a 3.1% annualized rate in Q3 which was well above The Street’s expectations of 2.0%.

Today is The Big Report day. The Labor Department just released its Employment Situation Report noting 161,000 new jobs were created in October and the unemployment rate dipped to 4.9%. Very importantly, wages rose at their fastest pace since 2009. With inflation at around the Fed’s target of 2.0% I just don’t see how the Fed cannot raise rates at the FOMC meeting next month. More on this in Monday’s Blog. By the way, this is the last report before the election.

So how is the market taking the jobs report? Ho-hum. The Dow is up 14 and the S&P is up 5.

Oil

Oil prices remain firmly on the defensive. WTI fell another 68¢ yesterday closing at $44.66 and Brent ended off 51¢ at $46.35 for the 5th consecutive session marking 6 week lows. The EIA’s report on Wednesday noting a record climb in crude oil inventories and the lack of any progress on OPEC cutting production is crushing the bulls. I’m going out on a limb here but it looks like the rise in price a month or so ago was engineered by the Saudis prior to their gargantuan bond offering, the largest ever, by a lot, by an emerging economy. Crude oil is everywhere right now. Why do I say this? Because the contango in the price curve gets wider every day indicating that crude is bidding more and more aggressively for storage.

Crude was down as much as $.105 this morning but has rallied back to unchanged. Big rally. My antennae are raised.

Courtesy of MDA Information Systems LLC

Natural Gas

Natural gas prices settled lower once again yesterday as the weak cash market pulls futures lower. The December contract closed down 2.3¢ at $2.769, which was about 47¢ greater than where cash traded. Talk about price movement! The December contract has plunged nearly 45¢, 14%, in less than a week! The warm weather has created a no-load situation (no HDD’s or CDD’s), and it’s been like that for a month.

The EIA reported in its weekly storage report yesterday that 54 Bcf was injected into storage last week which compares to an expectation of 57 Bcf. Close enough. We now have a total of 3,963 Bcf in storage. The peak last year was 4,006, which was a record. With record high temperatures this week throughout the country we’ll have another injection next week. We need a total of 43 Bcf to match last year’s number. Although we’re in November and supposedly beginning winter, I’ll take the over on the 4,006 Bcf. It’s going to be close. Regardless, 4 Tcf is a lot of gas, especially with the extended forecast showing December to have above normal temperatures, which is why natty has been getting pounded. This morning natty is basically unchanged down 0.7¢.

Elsewhere

Over 30 million people have early voted in this year’s election. That’s a record by a wide margin. And a huge percentage of total votes. In 2012 a total of about 126 million people voted.

Franklin Pierce was the first president to have a Christmas tree in the White House.

John F. Kennedy was the first president to hold a press conference on television.

The House of Representatives has determined two elections in the U.S. The election of 1800 between John Adams and Thomas Jefferson and the election of 1824 between Andrew Jackson and John Quincy Adams.

William McKinney was the first president to campaign by telephone.

Franklin Pierce gave his 3,319 word inaugural address completely from memory. No notes.

Theodore Roosevelt was the first president to call his home the “White House.” Prior to that it was called the Executive Mansion or the President’s House.

Lyndon B. Johnson was the first American president to name an African American to his cabinet.

Andrew Jackson was the first president to ride in a railroad train.

Barack Obama collects Spiderman and Conan the Barbarian comic books.

Zachary Taylor received his nomination for the presidency late because he refused to accept all postage due correspondences.

Thomas Jefferson wrote his own epitaph never mentioning that he served as president. He mentioned the was an author of the Declaration of Independence, author of the Statute of Virginia for Religious Freedom and Father of the University of Virginia, but not the presidency.

Before Abraham Lincoln became president he failed as a business man, storekeeper and farmer. He also failed at his first attempt to obtain political office.

Lyndon B. Johnson is the only president to take the oath of office from a female official, Judge Sarah T. Hughes.

Millard Fillmore refused an honorary degree from Oxford University because he felt he had “neither literary nor scientific attainment.”

The term “O.K.” is credited to Martin Van Buren who was raised in Kinderhook, New York. After he went into politics, Van Buren became known as “Old Kinderhook.” Soon people were using the term O.K. referring to Van Buren and the word “okay” was derived.

Calvin Coolidge refused to use the telephone while in office.

Jimmy Carter was the first president born in a hospital

Hebert Hoover approved “The Star Spangled Banner” as the national anthem.

Harry S. Truman’s mother, a confederate sympathizer, refused to sleep in Lincoln’s bed during a White House visit.

George H.W. Bush is distantly related to Presidents Franklin Pierce, Abraham Lincoln, Theodore Roosevelt, Gerald Ford, Benedict Arnold, Marilyn Monroe and Winston Churchill.

Andrew Johnson was buried beneath a willow tree that he planted. His head rests on a copy of the Constitution.

To set a good example for the country Rutherford B. Hayes banished liquor and wine from the White House. Because of the ban, his wife was known as “Lemonade Lucy.”

Thomas Jefferson was the first president to shake hands with guests. Previously, people bowed to Presidents. Jefferson’s library of 6,000 books was purchased for $23,950 and formed the basis for the Library of Congress.