Keystone's Morning Wake-Up 10/30/12; Hurricane Sandy; U.S. Markets Remain Closed

Hurricane Sandy reaches the East Coast causing a two-day market shutdown. Markets have not been shut down for two consecutive days due to weather since 1888. The damages will be in excess of 20 billion dollars but daylight will provide further information.  The subway is flooded and fires are breaking out due to exploding transformers and other electrical issues. Power is out for much of New York with millions of people experiencing power outages up and down the East Coast.

Futures opened normally last evening at 6 PM EST (5 PM CST) and are trading today thru 9:15 AM EST (8:15 AM CST).  The S&P's are currently down two, Dow Industrials down 31 and Nasdaq down 10.  The euro moves up and away from the psychological 1.29 level, now printing 1.2949 providing a lift to European markets.  Spain GDP shows five consecutive quarters of contraction and this will only get worse moving forward due to austerity measures.  The BOJ announces stimulus measures but suprisingly the dollar/yen drops on the news rather than rising as would be expected.  UBS announces 10K layoffs that will occur over the next three years as the bank closes its fixed income division. As would be expected, the stock price jumps higher but over the intermediate and longer term, major companies announcing new rounds of mass layoffs is very troublesome for the global economy.  AAPL announces a shake-up with key personnel leaving the company as a result of Mapgate (in the States, scandals with political parties or companies are called out with the 'gate' suffix attached. This began after the Watergate scandal resulting in President Nixon's resignation three decades ago. Thus, the Apple mapping problem, a major headache for this tech heavyweight moving forward, receives the dreaded Mapgate moniker) problems with the iPhone5. Said jokingly, the iPhone5 maps are now showing that Hurricane Sandy is headed for Arizona.

The earnings releases and economic numbers are in disarray this week. The very important Consumer Confidence number scheduled to be released today is pushed to Thursday.  The stock exchange needs to open tomorrow (Wednesday) since this is the end of the month and not only do the funds use the EOM prints as benchmark numbers but also many funds close out their fiscal year tomorrow. Therefore, it is critical to receive an official print tomorrow to properly close out the books for accounting purposes, and the exchanges need to open even if only for two or three hours.  The 10-year Treasury yield is at 1.72%. The same parameters listed yesterday are in place once trading does resume, likely tomorrow. The waiting game continues. Said somewhat tongue-in-cheek, and not meant to diminish the ongoing seriousnes of the Hurricane Sandy turmoil, go long umbrella's, flashlights, batteries, generators, chainsaw's, bread, milk, water and toilet paper.

Note Added 10/30/12 at 9:17 AM EST:  The S&P Case-Shiller Index data reflects the consensus with a slight increase hinting that a slow motion recovery in the housing sector continues.  Futures go out with S&P's up 4, Dow up 8 and Nasdaq down 4 in thin trading. The euro is 1.2961. Watch for news today concerning the opening of markets tomorrow.