Monday morning and the markets are gapping up around 1/4%.
Of note, Financials positive, metals mixed and biotech, Oil negative as is TLT.
I would view this as neutral for the premarket.
The short term picture for the markets have improved a bit and a down day today might entice me to get a mean reversion trade going. In addition, depending on how things setup this morning I will be looking at csx and key for swings.
On the geopolitical front things are heating up again. Russia is throwing some U.S. diplomats out of the country in retaliation for more sanctions by the U.S.
N.Korea is now saying they have the means to deliver a Nuke to the U.S. Right or wrong this rhetoric is getting heated, to say the least.
Iran has kidnapped more Americans and China is staying quiet.
Depending on what the U.S. does in N.Korea will most likely determine how things go geopolitically in the short run. The Sanctions on Russia so not help to quiet things down. This Russia obsession by our Congress really is getting quite dangerous for the markets and the U.S.
Then of course at home, we have our do nothing Congress who cannot even get a reasonable health care bill to fix the failing affordable care act. In addition, you now have the House calling for a 2nd special counsel to investigate Clinton, Obama, Comey, Lynch and whoever else they can think of.
I suspect Sessions will appoint a special counsel soon. Say within the next two weeks. I put the odds at around 2 to 1 in favor.
Nothing new has come up on the political odds. If anything new comes up that looks reasonable I will post it here.
There is one wager though that looks positive to me and that is what party is going to win the presidency in 2020. Right now the Democrats are a 6 to 5 favorite. I would take the odds.
I do not see how anything has changed much since Trump broke the Democrats firewall. If anything, it appears things have gotten better for the Republicans. I would say the odds should be around 2 to 1 in favor of the Republicans.
Now a lot can happen between now and 2020. The Republican congress has done everything in its power to fail. But, so have the Democrats.
The loser in all of this will be establishment republicans should things stay on course. Many will get primaried out. So, you have the Democrats and Establishment Republicans taking a beating and the new republicans, think Kid Rock as an example, having big gains in 2018 and 2020.
The electorate is madder now than they were when they put Trump in the White House and its not at Trump. Its at Congress.
So expect the markets to have a higher amount of volatility and event risk is extremely high right now on every front.