Markets rise as earnings are reported

Dow climbed 204, advancers over decliners 5-2 & NAZ advanced 121.  The MLP index crawled up 1 to the 249s & the REIT index gained 4+ to the 326s.  Junk bond funds saw a little buying & Treasuries had only limited selling pushing yields a little lower, still at high levels.  Oil remained weak, down 1+ to the high 83s, & gold slid back 2 to 1985 (more on both below).

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The United Auto Workers (UAW) escalated its strike against Detroit's Big Three automakers for the 2nd day in a row, this time targeting General Motors' (GM) largest & most profitable facility.  Hours after GM reported its 3rd-qtr earnings, the union announced it is shutting down the company's Arlington Assembly plant in Texas, sending its 5000 workers there off the production lines & onto the picket lines.  "Another record quarter, another record year. As we’ve said for months: record profits equal record contracts." UAW Pres Shawn Fain said.  "It’s time GM workers, and the whole working class, get their fair share."  GM's Arlington plant produces the automaker's Chevrolet Tahoes & Suburbans, GMC Yukons & Yukon XLs, & Cadillac Escadales & Escalade-V models.  In reaction to the strike action, GM said, "We are disappointed by the escalation of this unnecessary and irresponsible strike. It is harming our team members who are sacrificing their livelihoods and having negative ripple effects on our dealers, suppliers, and the communities that rely on us."  CEO Mary Barra had addressed the UAW's strike in a letter to shareholders that accompanied the automakers' 3rd-qtr earnings earlier in the day.  She said the company's latest proposal to the union would mean the majority of GM workers would make $40.39 per hour, or roughly $84K a year by the end of the 4-year term of the contract.  "Since negotiations started this summer, we’ve been available to bargain 24/7 on behalf of our represented team members and our company," Barra wrote.  "They’ve [the UAW] demanded a record contract — and that’s exactly what we’ve offered for weeks now: a historic contract with record wage increases, record job security and world-class healthcare."  "It’s an offer that rewards our team members but does not put our company and their jobs at risk," Barra added.  "Accepting unsustainably high costs would put our future and GM team member jobs at risk, and jeopardizing our future is something I will not do."  The stock fell 63¢.
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UAW hits GM again, striking at automaker's largest plant

JPMorgan Chase CEO Jamie Dimon warned about the dangers of locking in an outlook about the economy, particularly considering the poor recent track record of central banks like the Federal Reserve.  In the latest of multiple warnings about what lies ahead from the head of the largest US bank by assets, he cautioned that myriad factors playing out now make things even more difficult.  “Prepare for possibilities and probabilities, not calling one course of action, since I’ve never seen anyone call it,” Dimon said during a panel discussion at the Future Investment Initiative summit in Riyadh, Saudi Arabia.  “I want to point out the central banks 18 months ago were 100% dead wrong,” he added.  “I would be quite cautious about what might happen next year.”  The comments reference back to the Fed outlook in early 2022 & for much of the previous year, when central bank officials insisted that the inflation surge would be “transitory.”  Along with the misdiagnosis on prices, Fed officials, according to projections released in March 2022, collectively saw their key interest rate rising to just 2.8% by the end of 2023, it is now north of 5.25%, & core inflation at 2.8%, 1.1 percentage points below its current level as measured by the central bank's preferred gauge.  Dimon criticized “this omnipotent feeling that central banks and governments can manage through all this stuff. I’m cautious.”  Much of the investment community has been focused on whether the Fed might enact another qtr percentage point rate hike before the end of 2023.  But Dimon said, “I don’t think it makes a piece of difference whether the rates go up 25 basis points or more, like zero, none, nada.”  In other recent warnings, Dimon warned of a potential scenario in which the fed funds rate could eclipse 7%.  When the bank released its earnings report earlier this month, he cautioned that, “This may be the most dangerous time the world has seen in decades.”  “Whether the whole curve goes up 100 basis points, I would be prepared for it,” he added.  “I don’t know if it’s going to happen, but I look at what we’re seeing today, more like the ’70s, a lot of spending, a lot of this can be wasted.” (One basis point equals 0.01%.)  Elsewhere in finance, Dimon said he supports ESG principles but criticized the gov for playing “whack-a-mole” with no concerted strategy.  “You can’t build pipelines to reduce coal emissions. You can’t get the permits to build solar and wind and things like that,” he said.  “So we better get our act together.”

Jamie Dimon rips central banks for being ‘100% dead wrong’ on economic forecasts

Rep lawmakers nominated Tom Emmer of Minnesota for speaker of the House of Representatives, the 3rd candidate they have selected in recent weeks after the previous 2 nominees failed to secure enough votes.  Emmer, the Rep majority whip, prevailed over a crowded field of 8 GOP candidates after several rounds of voting.  Interim Speaker Patrick McHenry has said the nominee could face a vote before the House floor as soon as today.  It is unclear if Emmer can secure the 217 Rep votes needed on the House floor.  He can only afford to lose 4 GOP votes, as Dems have lined up in lockstep behind their nominee, House Minority Leader Hakeem Jeffries.  The House has been leaderless for nearly 3 weeks now, which has left Congress paralyzed & unable to move forward with spending legislation as a Nov 17 deadline looms to avoid a gov shutdown.  Congress is also unable to respond to Pres Biden's call for emergency security assistance for Israel & Ukraine until the House elects a speaker.  Emmer was one of the only GOP candidates who voted to certify Biden’s 2020 election victory.  He also voted for spending legislation in Sep that averted a shutdown.  The Rep majority whip has the backing of former Speaker Kevin McCarthy.  “He sets himself head and shoulders above all those others who want to run,” McCarthy said of Emmer.  “We need to get him elected this week and move on and bring this not just party together but focus on what this country needs most.”

Rep. Tom Emmer nominated by GOP for House speaker

Gold prices fell as the $ rose while safe-haven buying eased as Israel continues to delay an invasion of the Gaza Strip in its war against Hamas following terror attacks from the Islamist group earlier this month.  Gold for Dec closed down $1 to $1986 per ounce.  The drop comes as worries over a widening war in the Middle East ease as Israel delays invading Gaza while Hamas slowly releases hostages taken during its attacks on Israel civilians & foreign nationals on Oct 7.  While defense forces are engaging with Hezbollah militants across the country's border with Lebanon, the war has not spread to other Middle East countries.  A rising $ is also checking gold.  The ICE dollar index was last seen up 0.72 points to 106.2, making gold more expensive for intl buyers.  Treasury yields were mixed, with the US 2-year note last seen paying 5.101%, up 4.3 basis points, while the yield on the 10-year note was 0.9 basis points to 4.84%.

Gold Closes Lower as Safe Haven Buying Eases While the Dollar and Yields Rise

Oil futures fell to tally a 3rd straight session decline.  After initially pricing in a geopolitical risk premium, the market appears to have sold off direct support tied to the outbreak of conflict between Israel & Hamas.  While the situation remains in focus, the tangible impact on oil market fundamentals remains minimal.  Dec West Texas Intermediate crude fell $1.75 (2.1%) to settle at $83.74 a barrel.

Oil futures end lower for a third straight session

No shortage of confusion out there.  Many have forgotten, the House has just 3 weeks left to fund the gov for the new fiscal year.  But that ship is currently dead in the water.  Lots of talk but nothing is getting done.  Some of the big tech companies are reporting earnings later which could give the stock market a boost tomorrow.  Bigger picture is that all is not well in the US economy & around the rest of then world.  That spells trouble for the stock market.

Dow Jones Industrials