We’re a few minutes from the open. Futures are up 0.5% on the S&P and 0.8% on the Nasdaq. Oil is down 6% after the U.S. and Iran spent the weekend in talks brokered by Qatar. U.S. crude is back under $100 at about $97.50. Brent is at about $106.60. I wouldn’t put much faith in the talks yet.
The ISM manufacturing survey comes out at 10, and Apple reports after the close. The midterms are tomorrow. Treasury lays out its borrowing plans Wednesday. The trading desks are cautious going into both.
The Nasdaq’s 200-day held Friday. QQQ got within $4 of it at the low and bounced. That’s the line in the sand for the next few days.
October ended with the equal-weight S&P up almost 5% and the index down about 1%. That’s the average stock’s widest monthly lead since April 2009.
Our momentum readings show the same split before the bell. The equal-weight S&P is at +59. The cap-weighted S&P is at -7.9, just below even. The Nasdaq is weaker at -15.2, while the Russell is positive at +12.2. Health care leads our sector board with 16 breakouts and no breakdowns. Tech and communication services are at the bottom.
A lot of traders look for a squeeze on a Monday. Be careful with this one. A morning pop can roll over by the afternoon, and there could still be more selling today.
On the S&P, I’m watching 7,690. That’s about 1% above this morning’s level, right around the 50-day. Above it, the systematic funds step back in as buyers.
For tech, I’m waiting on one number. Our equal-weight Nasdaq reading is -4. When it turns positive, that’s my bid.
