U.S. MARKETS:

Extending the strong upward move seen over the past several sessions, stocks moved sharply higher during trading on Thursday. The major averages all showed significant moves to the upside, climbing further off last week’s multi-month lows.

The major averages saw continued strength going into the close, ending the session near their best levels of the day. The Dow jumped 564.50 points or 1.7 percent to 33,839.08, the Nasdaq surged 232.72 points or 1.8 percent to 13,294.19 and the S&P 500 spiked 79.92 points or 1.9 percent to 4,317.78.

The extended rally on Wall Street came amid optimism about the outlook for interest rates following the Federal Reserve’s monetary policy announcement on Wednesday.

The Fed left interest rates unchanged for the third time in the past four meetings, leading to optimism that the central bank is done raising interest rates.

Treasury yields moved notably lower on Wednesday and showed another significant move to the downside today, adding to the buying interest.

The latest economic data added to the optimism about rates, with the Labor Department releasing a report showing an unexpected uptick in first-time claims for U.S. unemployment benefits in the week ended October 28th.

The report said initial jobless claims crept up to 217,000, an increase of 5,000 from the previous week’s revised level of 212,000.

Economists had expected jobless claims to come in unchanged compared to the 210,000 originally reported for the previous week.

A separate report from the Labor Department also showed an unexpected decrease in unit labor costs in the third quarter.

The Labor Department said unit labor costs fell by 0.8 percent in the third quarter after shooting up by a revised 3.2 percent in the second quarter.

Unit labor costs were expected to climb by 0.7 percent compared to the 2.2 percent increase that had been reported for the previous quarter.

“Stocks are rallying as Treasury yields plunge after another soft labor market reading,” said Edward Moya, senior market analyst at OANDA. “If Wall Street sees a soft NFP report tomorrow, you can kiss the chance of one more Fed rate hike this cycle goodbye.”

On Friday, the Labor Department is scheduled to release its closely watched report on employment in the month of October.

Economists currently expected employment to increase by 180,000 jobs in October after surging by 336,000 jobs in September. The unemployment rate is expected to remain at 3.8 percent.

Sector News

Banking stocks moved sharply higher over the course of the session, resulting in a 4.5 percent spike by the KBW Bank Index.

Interest rate-sensitive housing also saw substantial strength on the day, with the Philadelphia Housing Sector Index surging by 3.4 percent.

A significant increase by the price of crude oil also contributed to a rally by oil service stocks, driving the Philadelphia Oil Service Index up by 3.4 percent.

Airline, commercial real estate and telecom stocks also saw considerable strength, moving higher along with most of the other major sectors.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Thursday. Japan’s Nikkei 225 Index jumped by 1.1 percent, while Hong Kong’s Hang Seng Index climbed by 0.8 percent.

The major European markets also turned in a strong performance on the day. While the French CAC 40 Index surged by 1.8 percent, the German DAX Index and the U.K.’s FTSE 100 Index shot up by 1.5 percent and 1.4 percent, respectively.

In the bond market, treasuries moved sharply higher, extending the notable advance seen in the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, tumbled by 12.0 basis points to 4.669 percent.

Looking Ahead

While the monthly jobs report is likely to be in the spotlight on Friday, earnings news may also attract attention, as tech giant Apple (AAPL) is among the companies releasing their quarterly results after the close of today’s trading.

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VTI – TOTAL STOCK MARKET INDEX – DAILY – PUSHING TO RESISTANCE AT THE 50 DAY MOVING AVERAGE

Could We See Traditional Fall Market Rally?

https://www.howestreet.com/2023/11/could-we-see-traditional-fall-market-rally-mark-leibovit/

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CRYPTO UPDATE AS OF NOVEMBER 2, 2023:

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$2,000 gold is just the beginning. Here’s what might happen next – Sovereign Man

Will gold continue going up? We’ve already seen a 21% increase this year and it appears that’s just the start for this new gold bull. Global tensions, both political and financial, are mounting by the day and are creating the perfect launchpad for soaring gold prices. Now is the perfect time to shore up your portfolio with physical metal.

by Simon Black

Public Law 93-373 was supposed to be so boring that Congress didn’t even bother to give it a name.

You know how most laws passed by Congress have some fancy name- like the “Inflation Reduction Act” or the “USA PATRIOT Act” or some such nonsense?

Well, on November 7, 1973, US Senator James Fulbright introduced a very short bill- it was only ONE page- that didn’t even have a name. But Fulbright’s unnamed bill ended up being one of the most important pieces of legislation in US history.

By the time Fulbright introduced his bill, it had been two years since the legendary “Nixon Shock” of 1971. That was when US President Richard Nixon implemented wage and price controls, and canceled the US dollar’s convertibility into gold.

Nixon famously promised the American public that there wouldn’t be any negative consequences from his actions. Yet inflation hit 3% the following year, in 1972. Then 4.7% in 1973. Then 11.2% in 1974. 

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The fuse on America’s debt bomb just got shorter -Fox Business

The US debt problem is not news to anyone … unless you’ve been living under a rock for the last several decades. What may be news is that we’ve incurred as much additional debt in six months than what we did in the previous 12. This is a non-sustainable trajectory by anyone’s measures. The downward spiral this will create in our financial markets is nothing short of terrifying!

by E.J. Antoni
debtIf you thought it was scary when the Treasury Department recently dropped a financial bomb, announcing the deficit for fiscal year 2023 was $1.7 trillion dollars, please sit down before you read on. The Treasury just released new numbers projecting borrowing of $1.6 trillion in just the first half of fiscal year 2024.

As if the 23 percent growth in last year’s deficit wasn’t enough, the Treasury is now on track to borrow almost as much in just six months as it did in the previous 12. That’s nearly a doubling of the deficit. It means the Treasury is on track to borrow over $3 trillion this fiscal year, 50 percent more than previously estimated by the Congressional Budget Office.

Besides the pandemic in 2020, America has never run deficits like the previous, current, or next quarter, at $1 trillion, $776 billion, and $816 billion, respectively. In the four quarters that preceded the pandemic, the Treasury had an average deficit of under $300 billion, about half to one-third of today’s levels.

To be clear, borrowing was much too high even before 2020. But the fact that borrowing is now almost three times as high speaks volumes about how quickly things are spiraling out of control. The federal government’s financial situation resembles a stereotypical bomb from a cartoon or cinema, spherical in shape with an impractically long fuse. 

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Russia Makes Huge Announcement on BRICS Currency- Watcher.guru

BRICS has been talking about launching their own currency for a while now, and that time may finally be here. The growing interest in BRICS by countries throughout the world is making this transition a very believable – perhaps inevitable – reality moving forward. What this will do to the value of the dollar remains to be seen, but most experts suggest it will not be a favorable change as it relates to the buck’s future.

by Vinod Dsouza
The 15th BRICS summit in August this year ended on a high note as the alliance inducted six new countries into the bloc. The induction of new countries is historic, as the group decided on expansion after more than a decade. The expansion comes at a time when BRICS is working on the formation of a new currency to challenge the US dollar. In the latest update, Russia’s former advisor to the President and economist-turned-politician, Sergey Glazyev, made a huge announcement on the formation of the upcoming BRICS currency.

Sergey’s statements indicate that BRICS is serious about launching a new currency to take on the US dollar. Going by Russia’s economist comments, the new BRICS currency might be launched during the 16th summit in 2024. 

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Dot-Com Bubble Redux? Charles Schwab Begins Layoffs Amid “Challenging Year” -Zero Hedge

by Tyler Durden

A Charles Schwab spokesperson confirmed to Bloomberg that up to 6% of its 35,900-member workforce (or about 2,154 employees) were recently laid off.

“These were hard but necessary steps to ensure Schwab remains highly competitive, with industry-leading levels of efficiency, well into the future,” the spokesperson said in an emailed statement, adding, “We worked diligently to ensure
affected employees were treated with care and respect throughout this difficult process.”

The cuts were first reported by The Wall Street Journal on Monday night (read the previous update below).

The last time Schwab went on a hiring – then firing spree was the Dot Com bubble. It appears the pattern is repeating.

According to the layoff tracker website Layoffs.FYI, hundreds of thousands of tech employees have been fired in the last two years.

The latest ADP print shows the labor market has slowed.

* * *

Charles Schwab, the largest publicly traded US brokerage firm, began laying off employees on Monday in an effort to streamline its business model by reducing expenses ahead of next year, which could be full of turbulence in financial
markets. This comes as the market’s excitement in meme stocks, SPACs, IPOs, and crypto, which soared in 2020-21, has since plunged due to a rising interest rate environment. 

Gold could reach $3,000 in 2024 predicts commodity expert -Finbold

by Vahid Karaahmetovic

In the midst of escalating geopolitical tensions in the Middle East and mounting fears of a recession in European economies, spot gold prices have surged impressively in the past month.

Gold’s value has climbed more than 10%, starting at $1,815 in early October and now around $2,000 per ounce, marking its highest level since May 2023.

What’s even more intriguing is the possibility that this remarkable rally is far from over. According to senior Bloomberg commodity strategist Mike McGlone, the precious metal may have the potential to ascend to as high as $3,000 in
2024.

On October 30, McGlone released a post titled “Copper $3, Gold Toward $3,000: US Recession Could Be 2024 Path.”

Notably, the commodity guru explained how the precious metal reached the highest-ever average annual price of $1,930 per ounce in the period from January 1 to October 27, 2023, in spite of a tough macroeconomic environment marked by
robust dollar, resurgence in stocks, and high rates.

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The war in Ukraine, along with the unprecedented attacks in Israel by Palestinian militant group Hamas last weekend, may have “far-reaching impacts on energy and food markets, global trade and geopolitical relationships,” Dimon said in a statement accompanying the bank’s third-quarter earnings release. “Thismay be the most dangerous time the world has seen in decades,” Jamie Dimon said. – Megan Henney, “JPMorgan CEO Jamie Dimon warns: ‘This May be the Most Dangerous Time the World has seen in Decades’: Sounds Alarm over Economic Outlook Amid Israel-Hamas War,” www.foxbusiness.com,
October 13, 2023.

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Billionaire investor Ray Dalio said there’s a 50-50 chance a world war will break out in light of the Israel-Hamas conflict.

“In my opinion, this war has a high risk of leading to several other conflicts of different types in a number of places, and it is likely to have harmful effects that will extend beyond those in Israel and Gaza,” Dalio wrote in an essay titled “Another Step Toward International War,” which he posted Thursday on LinkedIn.

“Primarily for those reasons, it appears to me that the odds of transitioning from the contained conflicts to a more uncontained hot world war that includes the major powers have risen from 35% to about 50% over the last two years.”

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