Low Expectations and Gaming the Fed
We are now back in the twilight zone game called Gaming the Fed: More weak data increases the chances of a third round of quantitative easing.
Never mind that the ADP has a very mixed history predicting the jobs report on Friday—remember July? ADP big, but the jobs data was weak.
Europe was up earlier, as was our futures, because of The Golden Rule of August: When European bank stocks are stable or higher, our markets open up or stable, and vice-versa.
UBS, Credit Suisse, Barclays and other European banks up two to three percent.
1. Good riddance August: It may be ending on a high note, but so far it's the worst August in 10 years. So far this month, the Dow Jones Industrial Average is down 4.8 percent, the S&P is down 6.1 percent, and the Nasdaq is down 6.5 percent.?
Those 3 major indices are down four straight months. That’s the longest monthly losing streak since September 2008 to February 2009 for the Dow industrials, since November 2007 to March 2008 for the S&P, and since November 2007 to February 2008 for the Nasdaq. ?
2. After activist investor Carl Icahn lowered its bid for Clorox to $10.4 billion, or $78 a share, the consumer-products maker said it "remains open to any credible proposal," but deems the latest bid is "highly conditional, substantially undervalues the company and is not credible."
3. Genesco rises 3 percent after beating estimates (16 cents a share vs. 10 cents a share consensus). The retailer, whose brands include Johnston & Murphy and Lids, saw same-store sales rise 14 percent in the quarter. Also, back-to-school sales have been off to a good start, with August same-store sales up 12 percent. The company significantly boosts its full-year guidance to $3.35 a share to $3.42 a share, above $3.31 a share consensus, with same-store sales expected to rise 7 percent to 9 percent.
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