Markets trim gains ahead of the Fed meeting announcement tomorrow

Dow finished up all of 1 (just below 28K again), advancers modestly ahead of decliners & NAZ jumped up 137.  The MLP index fell 2 to the 116s & the REIT index rose 3+ to the 363s.  Junk bond funds continued slightly higher & Treasuries drifted lower.  Oil shot up 1+ to the 38s as the tropical storm nears the Golf Coast & gold eased back 1 to 1961 (more on both below).

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Income for US households rose sharply last year, & the number of people living in poverty declined, indicating that many Americans' finances were on the upswing before the coronavirus pandemic derailed the nation's economy.  Median household income increased 6.8% to $68K, the highest on record, according to data released by the Census Bureau.  Household income includes employment bonuses, payments from public assistance, interest & divs from investment & Social Security, in addition to other sources.  The nation's poverty rate fell by 1.3 percentage points to 10.5%, down from 11.8% in 2018.  It marked the lowest rate since estimates were first published in 1959 & was the 5th consecutive decline.  There were 34M living in poverty in 2019, 4.2M fewer people than 2018.  Before the coronavirus-induced downturn, the US was in the midst of the longest economic expansion on record, with the unemployment rate hovering around 3.5%, a ½-century low.  But the pandemic triggered a wave of layoffs -- 22M Americans lost their jobs as a result of the crisis -- with lower-wage workers among the hardest hit (one report from the Federal Reserve showed that 39% of individuals with a household income below $40K lost their job in Mar).  There are still 11.5M more out-of-work Americans compared to Feb.  The gov passed a massive stimulus package at the end of Mar to blunt the economic pain of the crisis, including sending a one-time payment of up to $1200 to some Americans & boosting unemployment benefits by $600 per week.

US median income soared to record high in 2019 as poverty fell

The New York Fed's Empire State business conditions index rose 13.3 points to 17 in Sep, the regional Fed bank said. The forecast called for a reading of 6.  The gain reverses a 14 point decline in the prior month. This is the 3rd consecutive positive reading in the index.  Any reading above zero indicates improving conditions.  The new-orders index climbed 8.8 points to 7.1 in Sep while shipments rose 7.4 points to 14.1.  Unfilled orders continued to decline but at a less rapid pace.  Inventories also remained in negative territory.  The index for number of employees held steady while the average workweek rose 13.5 points to 6.7.  Optimism about the 6-month outlook rose 6 points to 40.3.  The New York index is the first look at manufacturing conditions in Sep.  Economists were expecting some improvement after the decline in Aug, one of the weakest for the regional surveys.  Economists are divided over the outlook for manufacturing.  Some see the gains seen since Jul moderating into the end of the year.  Others see the factory sector as a bright spot, noting the national ISM factory index hit a 2-year high of 56 in Aug.  Manufacturers in the New York region report that they are optimistic, but they are not adding workers.

Empire State factory index signals improving conditions in September

Apple (AAPL), a Dow & NAZ stock, has unveiled its new Apple Watch Series 6, Apple Watch SE & a new iPad Air at an event at the tech giant's headquarters.  It announced the new Apple Watch Series 6, which comes with a new health sensor, according to COO Jeff Williams.  "With Apple Watch Series 6 you can measure your blood oxygen right from your wrist," he said.  The Watch contains an S6 dual-core processor that is optimized for Series 6 & a new chip that will make the watch about 20% faster than the Series 5.  It also comes with an optimized display that makes it easier to view in bright sunlight.  The Series 6 can also detect blood oxygen levels using infrared technology & measure elevation in real-time.  Williams also discussed new specialized watch faces for the likes of surfers & healthcare workers & announced a new solo loop band for the Watch that has no buckle or clasp.  "The solo loop is stretchable so that you can easily slip it on and off your wrist."  Pricing for Apple Watch Series 6 starts at $399.  As anticipated, AAPL also unveiled a new, cheaper Apple Watch, the Apple Watch SE, which is priced from $279.  The stock crawled up 18¢.
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Apple unveils new Watch Series 6, Apple Watch SE

Gold futures notched back-to-back gains to mark their highest finish in 2 weeks, ahead of what are expected to be dovish statements from global central banks this week that may provide renewed support for the precious metal.  A rise in Treasury note yields & the stock market had pressured prices for the precious metal for part of the day's session.  The Federal Reserve will conclude its 2-day meeting tomorrow with a statement on monetary policy, while other policy decisions from Bank of England & the Bank of Japan will follow on Thurs.  Investors expect global policy makers to promote a regime of low interest rates for a prolonged period to combat COVID-19, which could lift both gold & stocks further.  Investors expect global policy makers to promote a regime of low interest rates for a prolonged period to combat COVID-19, which could lift both gold & stocks further.  Dec gold  rose $2 to settle at $1966 an ounce, marking the highest most-active contract settlement since Sep 1.

Gold notches back-to-back gains for highest finish in 2 weeks

Oil futures got a lift as Hurricane Sally neared landfall, forcing the shutdown of more than a ¼ of offshore Gulf of Mexico crude production & a number of refineries.  Rising worries over energy demand served to limit the upside for oil prices, prompting them to finish off the day's best levels.  The center of Hurricane Sally is expected to pass near the coast of southeastern Louisiana today & make landfall late in the day or early tomorrow.  “Historic, life-threatening flash flooding is likely” along portions of the northern Gulf Coast.  The current estimate for the total outage associated with Sally is 3-6M barrels of oil over approximately 11 days.  West Texas Intermediate crude for Oct rose $1.02 (2.7%) to settle at $38.28 a barrel, while Nov Brent crude, the global benchmark, rose 92¢ (2.3%) to $40.53 a barrel.  Worries remain over the outlook for oil demand were fed by a report from the International Energy Agency which showed expectations for a fall of 8.4M barrels this year in global oil demand to 91.7M barrels a day.  That marks a contraction of 300K barrels a day more from last month's report.

Oil prices finish higher as Hurricane Sally disrupts Gulf of Mexico energy production

The Dow was up until the last 2 hours when sellers took it lower (mostly in the last hour).  Longer term, the Dow has been trending sideways near 28K for more than a month.  The bulls would say that it's a good sign because it's only about 1500 below its record highs in Feb.

Dow Jones Industrials