The Morning Hammer: The Trump Bump Continues!


The State of the Markets, Straight from Scott Redler

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Yesterday, markets staged a big rally following an overnight session that was so bad that SPX futures went limit down.

Traders were disappointed with Donald Trump's historic victory over Hillary Clinton,

The Trump Bump continues this morning, with SPX and NDX futures well into positive territory, and the Euro Stoxx 50 up 1.1%.

One big story in the news today is that following the Brexit and Donald Trump's US Presidential election victory, we could see even more major political upheavals.

Now many folks think that Marine Le Pen, leader of France's far-right National Front party, could become President of that nation next year.

And Italy has a major reform referendum vote coming up on December 4 aimed at limiting the powers of regional governments in order to streamline legislation. But that could get rejected since Italian PM Renzi supported Hillary Clinton, which does not fit with the growing wave of global populism.

All across the globel, the establishment is becoming less established. Maybe THAT is the big trading/investing theme we need to focus on.

We could even look at Germany. PM Merkel has been considering running for a 4th term. Polls have indicated that about half of Germans oppose that.

If she does run, I suspect she would get destroyed.

The tide is just too strong.


The VIX is still falling and is under 14 this morning.

So all those put buyers that were scrambling to buy election protection are getting decimated once again.

The ISE Sentiment Index was just 68 yesterday even with the rally, pushing the 10 day moving average down to 67.4. That implies very, very negative sentiment.

The 10 day moving average of the CBOE equity put call is 0.735, which is slightly above the YTD average.

So we have a lot of hedges that probably need to be unwound, and that could propel the S&P 500 to record highs.

Good luck out there!