Apple Inc. (NASDAQ:AAPL) rose 2.2% as Chief Executive Officer Tim Cook will likely introduce a high-definition iPad mini and thinner iPad tomorrow. The S&P 500 gained 0.1% to 1,745.83 at 10:14 a.m. in New York. The S&P 500 had its best weekly gain since July last week. The Labor Department will tomorrow release the September jobs report, which was delayed from its original Oct. 4 date because of the 16-day partial federal shutdown. A report today showed purchases of previously owned homes fell in September for the first time in three months.
Equities: The DEC13 E-mini S&P 500 futures (CME:ESZ13) are up 2 points this morning to 1738, in strong but somewhat quiet trade before tomorrow’s pivot jobs number gets released at 7:30amCST. We do have a technical target above these levels of 1748. What could make the market sell off tomorrow? We believe if we get a very weak jobs number, that sign of economic slowdown will supersede the excitement over the potential tapering delay a really weak number would cause. If the number comes out below 100K, we could see a good amount of profit-taking tomorrow. 1719 is our first key support level.
Bonds: The DEC13 U.S. 30-year bond market (CBOT:ZBZ13) is down 10 ticks this morning, probably on minor position squaring before tomorrow’ s key report. The market may not want to be “too long” before the jobs report. The market is still above our key 133’18 level, and could extend much higher if we do get a sub 100K number tomorrow. If we get a really strong number, we look for a sell-off in the bond market, as taper-talk may start to scare the bond bulls.
Currencies: The DEC13 Aussie dollar continues to trade higher today, this morning up 2 ticks to 96.33. We believe this currency is a bit over-extended. Data from China tonight could have a big impact on the Aussie, as well as the jobs data tomorrow out of the US. The DEC13 Euro currency is lower by only 8 ticks, trading at 136.73, after hitting an overnight high of 136.91. We believe this currency still may have room to head higher. Again, we look towards tomorrow’s jobs report to dictate short term direction. The DEC13 U.S. Dollar Index (NYBOT:DXZ13) is trading right at the key line in the sand at 79.75.
Commodities: We are watching DEC13 coffee (NYBOT:KCZ13) to see when it might find a bottom. It has been very weak recently, and today is down more to $1.1310/lb. We believe we might see a ‘capitulation’ down day soon and then that might be a bottom for the near term. We are watching the 2009 low of around $1.05/lb as a possible target. We also focus on DEC13 silver futures (COMEX:SIZ13), the big gainer on the commodities board. Silver is up 1.67%, or $.37 to $22.28. Technically, silver could rally to the $24-25 level, especially if the jobs number comes in slightly weak tomorrow, which would potentially extend the no-taper ideas into 2015. DEC13 wheat (CBOT:WZ13) has sold down below the $7 level after a strong and steady rally of recent weeks.