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DJIA Industrial Average

Nov 1

Open: 11,120.30

High:  11,244.27

Low:   11,062.33

Close:  11,124.62

Change: 6.13 (0.06%)

RSI: 57

MACD (Delta): 12.26

Strategy: The US markets failed to charge up Monday after a strong opening, and closed on an almost flat note in a choppy session, as investors’  remained skeptical of Fed’s move in the upcoming meeting later this week, and remained cautious of outcome of mid-term US elections in 37 states. Markets continue to look tired at current levels, and are lacking a clear direction in absence of clear signals.  

Commentary

Stocks in US edged up nominally Monday, but investors appeared to be cautious on eve of US elections (mid-term) and Fed meeting later this week, before taking a fresh call regarding their stance in the US markets.

After soaring more than 100 points earlier in the session, the Dow Jones Industrial Average closed just 6.13 points higher. The S&P 500 edged up just 1 point, and the Nasdaq slipped close to 3 points in an indecisive session. A stronger-than-expected readings on U.S. and Chinese manufacturing growth sparked an early buying spree, which could not be sustained due to upcoming Fed meeting Tuesday and mid-term elections.

Advancing stocks amongst the Dow constituents included Intel Corp 2.6%, Pfizer 1.2%, Hewlett Packard 1.1%, Microsoft 1.1% and Travelers 1%.

However, the laggards on the Dow were led by Kraft -1.5%, Chevron -1.4%, Du Pont -0.8%, Alcoa -0.7% and Home Depot -0.6%.

Major Advancing sectors in the day included Tech (+0.4%), Telecom (+0.4%), Energy (+0.3%) and Health Care (+0.2%).

However sectors like Utilities (-0.9%) and Consumer Staples (-0.1%) lost some ground in the session.

Meanwhile, a report on personal income and spending Monday reflected that personal income declined 0.1% while personal spending increased 0.2% in September.

Another government data showed that construction spending unexpectedly rose 0.5% in September, though economists had expected a 0.7% drop.

A strong manufacturing numbers out of China provided a lift to the market early in the day, which it failed to sustain on certain major events due later this week.

JPMorgan Chase shares slipped nearly 1% amid reports that the Securities and Exchange Commission is investigating the bank's $1.1 billion deal with hedge fund.  

Cablevision Systems Corp. announcement last weekend that it has reached an agreement with News Corp. to return Fox programming to Cablevision sent shares of Cablevision up 1.7%, and shares of News Corp. also edged slightly higher.  

Meanwhile, it is estimated that AIG has raised $37 billion by selling off one insurance subsidiary, and the initial public offering of a second, AIA Group  Ltd. AIG's stock edged down slightly.

The dollar gained against major currencies like euro, the British pound and the Japanese yen.

Oil futures for December delivery also rallied Monday, gaining nearly 2%, to settle at $82.95 a barrel.

Gold for December delivery, however, slipped nearly $7 to settle at $1350.60 an ounce.

The Day Ahead

Tuesday

ICSC-Goldman Sachs Store Sales

FOMC meeting begins