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Market Brief – Wednesday 9/30/20

Stocks were mixed in overnight trading following the Presidential debate but were slightly higher going into the opening bell before stocks shot higher in early trading. In a very technical move, Treasury yields broke higher out of a consolidation pattern as investors still believe inflation is coming even though there is no lending growth to validate higher yields.

Mortgage applications fell -4.8% last week with purchase applications falling -1.9% and refinance applications falling -6.5%.

ADP Nonfarm Payrolls rose +749k, beating expectations of a +650k print, and August payrolls were revised higher.

The Chicago PMI showed activity has returned to the Chicagoland area as the by coming in at 62.4 indicating the factory sector in Chicago is in an expansionary trend.

Pending home sales surged higher by +8.8% in August and +20.5% from this time last year.

The Department of Energy reported crude oil inventories as Crude: -1.980mm (+1.569mm expected), Cushing: +1.785mm (+1.177mm expected), Gasoline: +683k (-1.083mm expected), and Distillates: -3.184mm (-917k expected). Crude oil rose following the report.

Stocks closed higher on the day but gave back some of their intra-day gains as stimulus hopes dwindled. After being pounded higher most of the day, Treasury yields closed off their highs as buyers stepped in during late trading.