Markets rise as traders wait for election results

Dow shot up 427 near session highs, advancers over decliners better than 4-1 & NAZ advanced 259.  The MLP index gained a very big 4+ to the 284s & the REIT index went up 3+ to the 426s.  Junk bond funds remained mixed & Treasuries finished little changed.  Oil edged higher into the 72s & gold inched up 2750 (more on both below).

Dow Jones Industrials 

The Federal Reserve Chair Jerome Powell have a lot riding on the election, even as the central bank has spent 2024 keeping as much distance as it can from politics.  The next pres is set to fill multiple open positions, &, with Powell's term at the central bank ending in May 2026, he or she will also be able to choose the next face of US monetary policy.  Perhaps the key question, as Kamala Harris signals a more status quo approach if she wins, is whether Trump would offer a deeper level of disruption than what he displayed in 2017- 2021.  During his first term, he attacked Powell with regularity & openly pushed for the actions he wanted, even once suggesting negative interest rates.  And he has signaled he could go further if he has a 2nd term in office.  Fed policymakers will also have a chance to discuss the implications this week as the Federal Open Market Committee gathers tomorrow & Thurs, with Powell at the head of the table.  The main topic for Fed officials will be whether to make the 2nd interest rate cut of 2024, with markets pricing in a 25 basis point cut this week, but the political fallout will be on their minds as well.

The Fed has a lot at stake on the vote's outcome

Amazon (AMZN) said it received regulatory approval to begin flying a smaller, quieter version of its delivery drone, the latest step in its long-running efforts to get the futuristic program off the ground.  The company unveiled  the new drone, called the MK30, in Nov 2022 & said then that the MK30, in addition to the other changes, would fly thru light rain & have twice the range of earlier models.  AMZN said the Federal Aviation Administration's (FAA) approval includes permission to fly the MK30 over longer distances & beyond the visual line of sight of pilots.  The agency granted a similar waiver for Amazon's Prime Air program in May, though that was limited to flights in College Station, Texas, 1 of the cities where it has been conducting tests.  Alongside the FAA approval, Matt McCardle, head of regulatory affairs for Prime Air, said the company is starting to make drone deliveries.  In Apr, AMZN said it planned to spin up drone operations in Tolleson, a city west of Phoenix, after it shut down an earlier test site in Lockeford, California.  The company will dispatch the drones near 1 of its warehouses in Tolleson as it looks to integrate Prime Air more closely into its existing logistics network & further speed up deliveries.  An FAA spokesperson said the agency granted AMZN permission to conduct beyond visual line of sight deliveries in Tolleson on Oct 31.  AMZN founder Jeff Bezos first unveiled plans for the ambitious service more than a decade ago, remarking at the time that the program could be up & running within 5 years.  Despite AMZN investing Bs of $s into the program, progress has been slow.  The stock rose 3.72.

Amazon gets FAA approval for new delivery drone as it begins tests in Arizona

State-run producer Saudi Aramco will sell its flagship Arab Light crude grade at a premium of $1.70 a barrel to the regional benchmark, according to a price list from the company, compared with $2.20 this month.  The company was expected to cut the premium by 45¢ a barrel, according to a survey of traders & refiners.  Sluggish demand growth, particularly slack crude use in China, & concern that added supply will leave extra crude in the market have helped keep oil prices in check this year.  So far markets have shrugged off concerns about the widening Middle East conflict as the heightened geopolitical tension has failed to interrupt physical crude supply.  Global benchmark Brent crude traded around $75 a barrel this week.  The OPEC+ alliance, led by Saudi Arabia & Russia, has been curtailing output to prop up the market with group-wide cuts in production extending throughout next year.  Group members that made voluntary output cuts won't go ahead with a plan to begin rolling back reductions in Dec.  This is the 2nd delay to its plans to revive supply, as oil prices continue to struggle amid a fragile economic outlook.  Further delays in production increases may do little to bolster prices.  Global markets still face a glut next year even if OPEC+ refrains from increasing supplies, the Intl Energy Agency in Paris estimates.

Aramco Cuts Oil Prices to Asia for December After OPEC+ Delay

Front-month gold futures settle up 0.2% to $2740 an ounce, while SPDR gold shares are up 0.1%.  The moves come as the Presidential candidates entered the day seemingly deadlocked.  But, a win by either Harris or Trump isn't expected to alter the trajectory for gold prices much.  The US national debt is expected to rise under either candidate regardless of who ultimately wins.  This has been a significant tailwind for gold in the months leading up to the election.  Until the election concludes, volumes are expected to stay limited.

Gold Inches Higher as U.S Election Day Progresses

Oil futures climbed, with US & global benchmark prices looking to post their 5th straight session gain as investors await the outcome of a contentious & close US presidential election.  West Texas Intermediate crude for Dec rose 68¢ (1%) to $72.15 a barrel & Jan Brent crude the global benchmark, was up 78¢ (1%) at $75.86 a barrel.  Oil prices maintained an upward trend, up a 5th day in a row, as risk taking remains limited with many headlines expected in the next few days, coming from the Federal Reserve's Policy meeting, China's congressional meeting that will determine governmental stimulus & the US election.  Oil was building on yesterday's gains, which saw WTI rise nearly 3% & Brent end with a gain of 2.7%, following a weekend announcement that OPEC+ members would hold off on unwinding 2.2M barrels a day in production cuts until year-end.  The cuts had been set to expire at the end of Nov.  When initially announced in the summer, the cuts had been scheduled to be unwound beginning in Oct.  Otherwise, the election, along with the Federal Reserve's policy meeting & China's National People's Congress, has led to cautious trading, with market participants on the sidelines

Oil prices up for a fifth straight session as traders await U.S. election results

Stocks jumped higher as Americans flocked to the polls on Election Day, with investors settling in to see whether Kamala Harris or Donald Trump will shape the future economy.  Investors are buckling in for market volatility, as the outcome may not become clear for days, or even weeks, if the result is disputed.