Fed officials are hinting that the odds of December rate hike are edging up. Yesterday’s round of comments from several policymakers still leaves room for debate for deciding if squeezing monetary policy at next month’s FOMC meeting is a done deal. But compared with the remarks in recent months, the public chatter on Thursday had a hawkish tone, if only on the margins.
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● US job openings rise in Sep to 2nd highest level on record | Bloomberg
● Fed officials consider case for US rate hike in Dec | Reuters
● US jobless claims unchanged last week, near 4-decade low | WSJ
● US Consumer Comfort Index edges higher in early Nov | Bloomberg
● Eurozone GDP growth eased to +0.3% in Q3 | Eurostat
● Q3 GDP: German growth moderates, French economy picks up | RTT

In a new article from Institutional Investor—“Market Timing Is Back In The Hunt For Investors”–AQR Capital Management reviews the case for market timing and finds an encouraging track record. Citing the historical record from 1900, AQR’s Cliff Asness and two colleagues outline what is effectively a century-plus backtest of the value and momentum factors. In line with analysis from other researchers, they find that the numbers favor a degree of dynamic portfolio management for adjusting asset allocation through time based on this dual-factor framework. There’s nothing particularly new here, at least for anyone who’s familiar with the research on the topic of tactical asset allocation (TAA) and the related subjects. Nonetheless, this is a worthwhile read if only because it provides a long-run perspective on how the application of value and momentum factors provide a powerful foundation for managing an asset mix through time.
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● US mortgage applications fall as rates rise | CNBC
● ECB President Draghi hints at more stimulus next month | Reuters
● Eurozone industrial output falls again in Sep from Aug | Reuters
● German inflation ticks higher in Oct | MarketWatch
● Consumer inflation edges higher in France in Oct | MNI
● Loan growth in China falls to 15-month low in Oct | Bloomberg

The US stock market has had a rough ride over the last three months. But if you averted your eyes from the volatility that started after Aug. 18 and checked the S&P 500 as of yesterday’s close (Nov. 10) it appeared that nothing much had changed. The fractional loss looks uneventful and so one might wonder what all the fuss was about? There’s been an enormous among of churning in the market since mid-August, but for the moment the dust has settled and from the perspective of the S&P 500 we’re right back where we started.
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● US import prices drop 0.5% in Oct, 4th decline in a row | MarketWatch
● US small business optimism index unchange in Oct | Reuters
● Redbook: US retail sales increase in first week of Nov | WSJ
● China’s industrial production growth falls to 6-mo low in Oct | Telegraph
● Retail spending in China ticks higher to 11% annual rate in Oct | IBT
● UK jobless rate falls to 8-year low in 3 months through Sep | BBC

US recession risk continues to fade after running moderately higher in recent months. But a variety of business-cycle metrics have only hinted at trouble without crossing the Rubicon. The main concern was linked to higher market volatility. But the economic data merely wobbled without actually falling down. The lesson, once again, is that mastering the art/science of monitoring and evaluating the business cycle requires a methodology that’s based on a spectrum of data that minimizes the potential for confusing market noise with robust macroeconomic signals.
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● US Labor Mkt Conditions Index rises to 3mo high in Oct | EconoTimes
● Conference Board’s Employ. Trend Index points to “solid job growth” in Oct | CB
● Moody’s still projects sluggish growth for G20 nations | EconoTimes
● Int’l Energy Agency sees oil rising to $80/bbl by 2020 | WSJ
● Low inflation persists in China | Reuters
● French industrial output rises more than expected in Sep | Bloomberg
● Industrial production in Italy rises less than expected in Sep | RTT
● Japan’s Oct Eco Watchers Sentiment Index rises, first time in 3mos | MNI

Equities in emerging markets took the lead last week, delivering the strongest gain among the major asset classes via a set of proxy ETFs. Vanguard Emerging Markets (VWO) popped 1.6% for the week through Nov. 6, edging out the number-two performer: US equities based on Vanguard Total US Stock Market (VTI), which climbed 1.2%.
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● US job growth spikes higher in October | Fortune
● Fed official: rate hike ‘makes sense’ | Reuters
● Will a strong dollar reduce odds for US rate hike? | Bloomberg
● US consumer credit up more than expected in Sep | RTT
● China’s disappointing trade data for Oct | Reuters
● German exports rise more than forecast in Sep | MarketWatch