Daily Market Update – December 2, 2014 (Close)

While we wait for Friday’s employment Situation Report this seems like the perfect week, with otherwise little economic news, to stuff a total of eleven Federal Reserve Governor speeches into it.

Conceivably, any of those could move markets, especially if speaking off script. The one most likely to do that is Richard Fisher, who speaks after Wednesday’s close. He is a hawkish member and will become a non-voting one next month.

Stanley Fischer, who is the Vice-Chairman and also thought to be relatively hawkish speaks twice this week, but thus far hasn’t ruffled any feathers in public, as Fisher has done throughout his tenure, dating back to Alan Greenspan’s time.

Meanwhile, Fischer spoke before the market’s open this morning and prior to the opening it didn‘t appear as if anything surprising or unintended had been said as the market’s modest open higher had been maintained since futures trading began earlier in the day.

In a week where there isn’t much news until the week’s end these speeches may end up being the only entertainment we get and possibly the only catalysts for some sort of movement.

It’s not really clear what sent the market higher today, but whatever it was it began shortly before the first 30 minutes of trading could even get done and then had another buying flurry start shortly after noon.

No real news of any sort to account for either of the moves higher, but interestingly while oil was giving back yesterday’s gains, oil stocks moved higher today, even though the broader sector was mixed.

Otherwise, the story will continue to focus on oil and retail for the week, at least until Friday’s Employment report. That report shouldn’t hold too many surprises and probably won’t be a springboard for any significant market moves higher. In fact, too good of a number would probably be construed as meaning wage inflation is ahead and a rising interest rate environment would come sooner than anticipated.

Most will probably be hoping for another month with job growth in the low to mid 200,000 range and  engendering little need for the market to react to the bland news.

While the focus is on retail, so far, the numbers for Black Friday and Cyber Monday are all over the place and their interpretations are also expressing a broad range. of opinion.

The same broad range of opinion is characterizing what sits behind OPEC’s decision to keep production steady. Many see it as an outright assault against the US shale industry, while a minority simply see it as another expression of Saudi Arabian duplicity in saying one thing but believing something very different. In this case the overt words are blatantly aimed at the fledgling US industry, but the real intent may be to bring no benefit to their enemies in Iran.

It just happens to be much easier to publicly fling arrows at the US, since there’s little worry of repercussion, as opposed to slinging those arrows at a
fellow OPEC member or the people who funnel arms to your enemies, not to mention your enemies.

Yesterday’s bounce higher in oil doesn’t appear to be replicating itself this morning and so energy may be on the radar screen for quite a while as we wait to see how lower prices to end users might impact the economy, even though the stock market may not see that same kind of potential benefit.

I would have loved the opportunity to take advantage of any possible moves higher today to sell some calls rather than adding more new positions, but while the market did move nicely higher the option market continued to be very quiet and had very low volume..

For now I’m content with some dividends this week and whatever additional premiums can be squeezed out of positions as the countdown to the year’s end has already begun. Another day like today would be welcome if investors can find any other reason to push levels even higher.