Markets finish the month with strong gains

Dow jumped up 241 (but 200 below the highs), advancers over decliners better than 3-2 & NAZ rose 144.  The MLP index bounced back 1+ to the 351s & the REIT index was up 4+ to the 346s.  Junk bond funds remained higher & Treasuries were sold all day while stocks were purchased.  Oil fell to the 65s to close out a very brutal month (more below) & gold pulled back 9 to 1215.

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General Motors (GM) said strong sales of full-size trucks and crossover vehicles in Q3 boosted profit & revenue.  EPS was $1.87 on revenue of $35.8B.  Analysts had expected EPS of $1.25 revenue of $34.8B.  In the year-earlier qtr, EPS was $1.32 on sales of $33.6B.  GM expects full-year EPS of $5.80-6.20 vs.a prior view of approximately $6, noting potential upside from strong performance & a favorable tax rate.  US sales fell 11% to 694K units.  Reduced incentive spending & increased sales of higher-margin trucks & SUVs resulted in average transaction prices rising by approximately $700 to $36K.  GM North America posted strong margins of 10.2%, driven by an increase in average transaction prices that rose to record Q3 highs.  In China, GM & its joint ventures delivered 836K vehicles in Q3.  Sales in China were down 14.9% from a year earlier due to the softening vehicle market.  GM, which employees more than 180K & has operations on 5 continents, yesterday declared a Q4 div of 38¢.  "Our disciplined approach to the U.S. market, combined with strength in China and further growth of GM Financial, drove a very strong quarter," Dhivya Suryadevara, CFO said.  "We will continue to take actions to mitigate headwinds including foreign currency volatility and commodity costs.”  The stock rose 3.05 (9%).

If you would like to learn more about GM, click on this link:
club.ino.com/trend/analysis/stock/GM?a_aid=CD3289&a_bid=6ae5b6f7

GM 3Q results top expectations on strong truck, crossover sales

The MNI Chicago business barometer (Chicago PMI) fell to 58.4 in Oct from 60.4 in Sep.  While that's above the 50 level indicating improving conditions, it was the lowest reading since Apr.   MNI attributed the downturn to a fall in order book growth & unfinished orders.

Chicago PMI falls in October to six-month low

Kellogg (K) reported Q3 EPS of $1.09. EPS, adjusted for non-recurring gains, were $1.06 per share which pretty much met expectations $1.07.  The maker of Frosted Flakes, Pop Tarts & Eggo waffles posted revenue of $3.47B, which topped the forecast for $3.42.  The company cut its earnings outlook & said it now expects full-year adjusted EPS to rise 7-8%, down from its prior outlook of 11-13%.  In addition, Kellogg also sharply cut its outlook for operating profit from a 5-7% increase to flat.  The stock sank 6.38 (9%).

If you would like to learn more about Kellogg, click on this link:
club.ino.com/trend/analysis/stock/K?a_aid=CD3289&a_bid=6ae5b6f7

Kellogg: 3Q Earnings Snapshot

Oil prices fell in volatile trade, posting their worst monthly performance since Jul 2016.  Strong US demand for fuel helped offset a 6th straight weekly jump in American crude stockpiles & evidence of rising global supply, but oil prices fell late in the trading session.  US light crude ended the session down 86¢ (1.3%) at $65.31 & the contract plunged 10.8% in Oct.  Benchmark Brent crude oil fell 44¢ at $75.47 a barrel, ending Oct down nearly 9%.  Both benchmarks were about $11 a barrel below 4-year highs reached on Oct 3 & saw their worst monthly performance since Jul 2016.  Oil has been caught in the global financial market slump this month, raising concerns about global oil demand.  Equities have been under pressure from the trade war between the world's 2 largest economies, the US & China.  The US has already imposed tariffs on $250B worth of Chinese goods & China has responded with retaliatory duties on $110B worth of US goods.  Oil market sentiment received some support today from equity markets, which bounced from 20-month lows after pledges by China to support its markets.  Oil prices briefly gained after the Energy Information Administration said crude inventories rose 3.2M barrels last week, less than expected.  Gasoline & distillate stockpiles fell as total product demand over the past 4 weeks rose 5.4% from a year ago.

Oil falls as US crude stockpiles rise for a sixth week

The stock rally in the last couple of days weren't good enough to cover previous selling in Oct.  The Dow finished down 1.3K & the NAZ lost more than 700.  Grrrh.  Selling in the tech sector has been under-reported, but that is significant.  The sexy tech stocks have been leading the overall market higher.  Now there growth potential has been called into question.  In addition, trade issues & rising interest rates will be dark clouds hanging over the stock market for months.

Dow Jones Industrials