In the MORNING COFFEE REPORT yesterday, I said that we could swing between SPX 3500 and 3550, and I am betting on 3550. I was wrong, but the morning started out that way.
3527.64 was the highs for the day, and it appeared that it was going to keep climbing. The brick wall that was hit was a messaged from Steve Mnuchin that stated: ”getting something done on corona virus relief package before election would be difficult”. He later stated that Nancy Pelosi has no interest in getting a stand alone bill to rescue the airlines. That is the democrat's leverage to getting the additional $600 billion in pork thrown into the bill.
So the run higher the market has been undergoing to approach all-time highs was in large part attributed to a $1.80 trillion package, and now it is getting distant. In the chart above, you can see that when the news came out, we fell through the “unchanged line”, and then fell hard moments later after the release of this information.
This news condemned the day to go into the history books as RED, and took the Dow into negative territory for the year. The Dow has been a pig this year, whereas the SPX still is higher by 8%.
AAPL closed slightly positive. This is actually encouraging given their abysmal HIGH SPEED EVENT reviews. Another $1200 for a phone that has 5G, but you can't get yet. And because of the towers not set up for 5G in most places, it will only be modestly faster than 4G. I'll wait until the phone is $600.