Morning 11-6

(Bloomberg) — If history is any guide, more gains may lie ahead for U.S. stocks. In data going back to 1950, the S&P 500 Index has never posted a negative return for the final two months after closing October up more than 20% for the year. This phenomenon, according to LPL Financial senior market strategist Ryan Detrick, could be due to portfolio managers buying to play catch-up or because, as Sir Isaac Newton noted more than 300 years ago, “an object in motion tends to remain in motion

News headlines:

·         The IHS Markit Germany Services PMI was revised higher to 51.6 in October 2019 from a preliminary estimate of 51.2 and compared to September’s three-year low of 51.4, final estimates showed
  • Oil prices fell on Wednesday morning after latest API data showed crude inventories in the US increased by 4.26 million barrels while markets were expecting a smaller rise
  • The real move from overseas fixed income markets however came from JGBs which got plastered last night, 10-year yields spiking 6bp to -0.08% amid a poor 10-year auction – IFR news

Markets sideways so far today spoos 7 handle range, Bunds have a  35 tick range, trading a bit soft at the moment though  at multi week lows, treasury  complex trading higher with a small bid after three consecutive lower closes it may be just a dead cat bounce. Gold also following Bonds higher as today is activity the opposite of the prior three days where stocks higher and bonds lower. Not much of a theme so far to describe today’s trade ,A very light Econ  calendar  today along Two Fed speakers Williams at 8:30 Harker at 2:15 unlikely to move needle much.

Still not a guarantee for U.S. China trade deal two stories below (Via ITC markets)

US must scrap tariffs for trade deal- The US would have to cancel some of its tariffs on hundreds of billions of dollars’ worth of Chinese products before Beijing could agree to what has been billed by US officials as a phase-one trade accord, a former Chinese trade official said on Tuesday. The US is “very anxious’ to reach a trade deal with China but Beijing won’t agree if the US does not cancel some tariffs, Wei Jianguo, former vice minister of commerce, told the Global Times. http://www.globaltimes.cn/content/1169065.shtml

Emboldened China refuses to flinch on tariffs in US trade talks– These outcomes have emboldened Beijing to insist that the U.S. withdraw all tariffs levied since summer of last year before entering an agreement. U.S. President Donald Trump, meanwhile, expects to sign the first phase of a trade deal this month, creating a situation ripe for tensions to reignite….Trump has pressed China to buy up to $50 billion worth of farm goods annually within the next two years. Beijing has called such goals unrealistic. https://asia.nikkei.com/Economy/Trade-war/Emboldened-China-refuses-to-flinch-on-tariffs-in-US-trade-talks

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