US Stock Market Overview – Stock Hit Fresh Highs, Led by Energy, Utilities Bucked the Trend

US stocks rallied on Monday, as positive sentiment following last weeks better than expected jobs data continued to buoy riskier assets. Additionally, the Fed cut interest rates last week, pushing the Fed fund rate down by 25-basis points to a range between 1.50% and 1.75%. The long end of the 10-year yield has started to rise as stock prices hit fresh highs. The VIX volatility index moved higher as it continues to attempt to find a bottom. The VIX on Friday tested the lows seen in July below 12. McDonald’s confirmed Monday that its Chief People Officer David Fairhurst has departed the company, following the firing of CEO Steve Easterbrook. Sectors were mixed, led by a surge in Energy prices, Utilities bucked the trend.

Despite stock prices breaking out to fresh highs, US yields have had a difficult time rising. Global yields remain under pressure as most of Europe, as well as parts of Asia, are experiencing the beginnings of a global recession. Recent data from Europe on the PMI side was stronger than expected, which did little to help the Euro. The dollar remains robust, which is somewhat weighing on US exports, helping to cap inflation as well as growth.

McDonalds Fires CEO

McDonald’s announcement Sunday evening that the board fired CEO Steve Easterbrook for violating company policy by having a relationship with an employee, weighed on the stock price on Monday. The Company rules do not allow relationships between managers and employees who directly or indirectly report to them.

Under Armor Shares Tumble on Announcement of Probe

Under Armor, shares tumbled nearly 20% on Monday after the company confirmed it was the subject of a federal investigation into its accounting practices. The criminal investigation comes from the Justice Department which could also be looking into Executives  who declined on an earnings call Monday to

European Manufacturing Data Was Strong Than Expected

The final EU manufacturing PMI numbers were slightly stronger than expected.  The headline print for October came in at 45.9, slightly better than the flash reading of 45.7.  Germany’s final PMI came in at 42.1, which was better than the 41.9 flash reading. Spain’s PMI surprised declining to 46.8 versus the initial flash of 47.7 in September as new orders disappointed with firms highlighting political uncertainty.  Italy’s reading was right on expectations at 47.7 versus 47.8 in September, with new orders showing the 15th consecutive month of contraction.