Jeff Saut Call of the Week

Jeff Saut...  DoubleLine Capital’s Jeffrey Gundlach is recommending for 2018, namely emerging markets and commodities, themes we have been featuring for quite some time. Manifestly, commodities relative to stock are as cheap as they have been in a long time (see chart 1 below).

The call for this week: Friday’s option expiration usually leads to a lower Monday open for stocks on position squaring. That is what is happening this morning with the preopening futures down marginally. Our conversations with international accounts suggest they are more worried about the government shutdown than our domestic institutional accounts. Ergo, if stocks decline during the morning, look for a rally after the European close. The real question is, “Will U.S. investors continue to ignore the shutdown like they did in 2013?” 2800, 2767 (gap), 2750 (gap), 2736, 2723 (gap), 2714 (gap) on the S&P 500 Index are support levels.