The October Economy
The Jobs PictureThe jobs picture in October was largely positive, with more and more people getting back to work.
Rising StocksThere’s no two ways about it, October was excellent for stocks. All of the major indices were up around 9%, and many surprising companies presented a good quarterly earnings report. One of the biggest shockers was McDonald’s (MCD), which turned a profit for the first time in two years. It wasn’t just McDonald’s that reaped the benefits of a strong October though. Amazon (AMZN) outperformed the already-booming October markets, and so did General Motors (GM). General Motors, which is still struggling to meet its IPO price, was up over 9% in the past month and shows no signs of slowing down now. Other big winners in October were Mattel (MAT) and Sonic (SONC). Mattel is a big surprise, because it relies so heavily on overseas sales to turn a profit. Still, it outperformed the market and had an excellent earnings report this quarter, all things considered. Sonic, a regional fast-food chain, is in much the same boat as McDonald’s. People are out spending more on fast food and toys, which is a good sign that this November and December’s retail season may be a big one.
Going Into NovemberAs we move into November, stock are continuing to move upwards, albeit slowly. The Dow is poised to cross the 18,000 point mark, which hasn’t been done since before the summer. Markets are poised to continue to rise as the month wears on. The summer doldrums are clearly over, and the market is ready to post some big gains. November promises to be a transitional month, and depending on how it goes we’ll have a clearer look at how the holidays will shake out, and whether or not the Fed will act to raise the prime rate this year. Many analysts think that a rate hike is coming this December, and October’s stellar stock performance and solid jobs numbers could be a big part of the reason why it happens.
Published on Nov 7, 2015By Aaron Phillips