The market is set to close relatively quiet on this Friday. However, the intraday activity is anything but quiet. Financial stocks especially brokers got hammered after WSJ reporting that there can be potentially more exposure and write-offs for Merrill Lynch, which hit a multi-year low in today's session. Oil hits another record close and now is above $95. Gold price, on the other hand, is back above $800 after nearly 28 years and now is within striking distance to break its historical high, which is $850. US dollar got weakened against several major currencies. As for Canadian dollar, it actually reached a new historical high with the US dollar and now is above 1.07 USD/CAD. Treasury bond also rallied as some investors tried to grasp risk-free assets amid continuous turmoil in the financial market. There won't be too much economic news next week and we have already passed two thirds of this earning season, so without any other shocking news, the market may finally take a breath.

The market certainly didn't give investors an easy time for the first day of what is supposed to be a good month. Downgrade in Citigroup along with disappointing earnings in Exxon are cited as main reasons to trigger today's selloff. Interest rate sensitive sectors such as financials and homebuilders are especially weak. It seems that some investors waked up this morning and suddenly realized the Fed had done its rate cutting job although the message should be quite clear last afternoon. Treasury bond rallied sharply and oil price dropped after touching $96 per barrel. The economic news this morning is also on the weak side. Tomorrow will bring the job report and it is possible we are going to have another volatile session.

Investors seem to get the treat they are waiting at this Halloween. As widely expected, the Fed cuts both discount rate and Fed fund rate by 25bps. However, in the statement they also mentioned that higher oil price will become an ongoing concern. In addition, it appears that the Fed may pause after this cut as the risk to economic slowdown and the risk to inflation are more balanced now.  Just as oil becoming a concern for the Fed, it shot up by another $4 and reached a new historical high amid a bearish inventory report. As I mentioned previously, continuous bearish inventory trend may lead the commodity to $100 mark and now the chance is obviously increasing. The GDP report this morning shows that other than the housing sector, the economy is doing fine and it is very unlikely we are going to get a recession in the near term. Inside the market, sector performance is widely divided with the sectors more sensitive to interest rate lagging while tech stocks continue to lead. As we are entering November and it is historically a strong performing month for stocks, let's see whether we are going to get the fourth quarter rally many investors are hoping for. Happy Halloween!

The market gave back all the gains from yesterday although the trading activities remained relatively quiet. Volume again is on the light side. Oil prices dropped by $3 per barrel but remained above $90. As we are going to get the much waited Fed interest rate decision in less than 24 hours, it's worth taking a few minutes comparing what is now with what was 6 weeks ago(September 18th): Interestingly, as for Dow, today's closing price is not much different from the September 18th closing price but Nasdaq is almost 7% higher compared to 6 weeks ago. This reflects the strong earning results for most tech companies in Q3. Now let's take a look at the oil price. Here the picture is totally different as the oil price is moved up by almost 15% even after taking into consideration of today's $3 drop. Higher energy prices along with other commodity prices will add pressure to the Fed as the foremost thing for the Fed is fight inflation. Despite that , it is very likely we are going to get a 25bps cut tomorrow but it will be very unlikely the Fed is going to cut by another 50bps. Again, everything will be clear in less than 24 hours.

The market is set to close higher for this Monday. However, the volume is quite light as many participants are waiting for this Wednesday's Fed decision. Oil sets another record close and is now above $93 per barrel. Gold prices moved higher amid weakening US dollar. Many overseas markets are closing higher with commodity related stocks taking the leadership. Although the market looks quiet today, everything can change in less than 48 hours so get prepared!