Stocks Pump'n'Dump After Pelosi "Pretty Happy" Comments

Update 1235ET: Did Schumer burst the optimism bubble with his attack on McConnell?

  • *SCHUMER SAYS VOTE ON SCALED-BACK GOP AID PLAN IS A 'STUNT VOTE' (as opposed to all the House votes?)

  • *SCHUMER SAYS BIGGEST OBSTACLE TO AID BILL IS MCCONNELL (or Democratic willingness not to bail out blue state pensions)

Stocks erased all the Pelosi pump...

Pelosi and Mnuchin are due to speak again at 1430ET.

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Update 1225ET: It appears the markets' goldfish memory is back as stocks have lept higher on "optimistic" comments from Pelosi that simply reiterated what she has said for a week...

It appears Goldman just did it again?

Only hours after the bank's chief political analyst Alec Phillips poured cold water on prospects of a fiscal deal getting done days before the election, writing overnight that "despite an optimistic tone and a slight narrowing of differences, the odds of pre-election fiscal stimulus continue to look very low", moments ago Pelosi once again pulled the rug from under deal pessimists, saying in a MSNBC interview that she is "pretty happy" about the state of relief talks, that "there is prospect for stimulus agreement", and that while she wants a stimulus deal before the election, "there will be a stimulus bill, the question is on timing."

Sending everything higher...

The chaos continues as algos get triggered...

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Update 1110ET: Pessimstic comments from Goldman on deal likelihood has spurred some derisking and its spreading across asset classes...

“Some of the biggest issues remain unresolved and a deal doesn’t seem particularly close,” Goldman economist Alec Phillips said in a note for clients.

“With big differences and little time, it seems unlikely that Pelosi and Mnuchin will reach a deal before the election. More importantly, even if a deal in principle is announced in coming days — this seems possible, but not likely — it looks very unlikely that it would pass before Election Day.”

From Hope to Nope...

The dollar is tanking...

And so is WTI...

As stimulus hopes fade, there is one safe haven that is bid...

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US equity market are ripping higher this morning as algos/investors speculated on whether there will be a stimulus deal... or no deal.

Specifically, White House chief of staff Mark Meadows said there was a goal to get “some kind of deal” in the next 48 hours.

And the machines melted up...

But as we have seen numerous times in the last 48 hours, these ramps often run out of squeeze ammo fast.

Bonds are ignoring this ramp for now but the dollar is dumping to fresh cycle lows...

Don't forget that the biggest issue remains state and local government aid, which is a key point for Democrats, and the Senate shows little signs of budging, putting all of this effort in jeopardy.