Sentiment/Wage growth/Some earnings comments

There is nothing like a stock market bounce to lighten the mood. Yesterday, Investors Intelligence said Bulls rebounded to almost back to 50 (where I define as extended) at 48.6 vs 42.3 last week. Bears slipped 1.1 pts w/o/w to 22.8. AAII today said Bulls jumped by 9.9 pts to 40, a 5 week high while Bears fell below that to 36.5 vs 41.6 in the week before. That's a 3 week low. The CNN Fear/Greed index which saw a level of 17 early last week and 22 one week ago from today, settled at 34 yesterday, out of 'Extreme Fear' and into just 'Fear.' Bottom line, nothing really to do with this as the contrarian set up for a bounce was early last week as I mentioned.

Ahead of CPI we saw the Atlanta Fed's wage data last night which reflected a 5.2% y/o/y wage gain in September vs 5.3% in August. For job stayers, wage growth was 5% y/o/y vs 5.2% in the month before. It peaked at 6.1% last year. There was no change in growth for job changers, up 5.6%. We know that private sector unions make up less than 10% of the labor force but of course those that aren't in one are watching all these strikes and the wage gains the unions are trying to achieve. On the other hand, the unions are just trying to catch their membership up to the wage gains non-union employees have already seen over the past few years. 

Bottom line, wage gains have certainly topped out in terms of rate of change but understand that even 5.2% growth is well above the 20 year average leading into Covid of 3.4%.