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 Markets slipped a bit today, but they continue to be a handful of points from their all-time highs. First, the scoreboard: - Dow: 15,545.7, -73.0, -0.4%
- S&P 500: 1,756.5, -6.7, -0.3%
- NASDAQ: 3,919.7, -10.9, -0.2%
And now the top stories: - The big economic news of the day definitely came from Chicago where the regional PMI exploded to 65.9 in October from 55.7 in September. This is the highest reading since March 2011 and the biggest jump in 30 years. "The government might have shut down but Chicago area companies powered ahead in October as orders and production surged," said Philip Uglow, Chief Economist at MNI Indicators.
- The blowout Chicago PMI number had economists across Wall Street resetting their expectations for the national ISM manufacturing index. "This is a very strong report overall, and as a result, we now expect a print of 56.0 in the manufacturing ISM released tomorrow (originally 55.5)," said Barclays' Cooper Howes. "We have written in the past that the Chicago PMI tends to have the most predictive power of all of the regional surveys when it comes to forecasting the manufacturing ISM, and a print of 56.0 would suggest that there was little slowdown in activity relative to the September print of 56.2."
- Initial jobless claims fell to 340,000 from 350,000 a week ago. This was a hair higher than the 338,000 expected by economists. "The coming several weeks should point to a more conclusive direction in the claims data, and we suspect that further improvement is likely as claims averaged roughly 330K before data collection issues began impacting the figures," said TD Securities' Gennadiy Goldberg.
- One of the big debates among stock market investors is whether valuations are so stretched that we could see a market crash. Many point to the cyclically-adjusted price-earnings (CAPE) ratio, the metric popularized by Nobel Prize-winning economist Robert Shiller which is at an unusually high level. Jefferies' Sean Darby wrote a 5-point rebuttal to the market-crash fear mongers. Among other things, he points out that stocks don't have to fall for the CAPE to revert to a long-term average. Rather, earnings just have to rise.
- Don't Miss: CITI: This Is What Will Happen To The World In The Next 4 Years »
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