Options Wonderland

[3xBuBu]

“The Fed created all these expectations and it’s going to be hard for them to deliver; anything less than $500 billion in QE would be uncivilized,” John Lynch, chief equity strategist at the Wells Fargo Funds Management division of San Francisco- based Wells Fargo & Co. that oversees $465 billion. “I’m not really buying into this rally. It’s going to be hard to deal with the election, Fed policy and the jobs report all in the same week. I fear the Fed won’t deliver what the market has priced in.”

This week’s elections and Fed meeting will be followed by a government jobs report projected to show the U.S. unemployment rate held steady at 9.6 percent last month, near a 27-year high of 10.1 percent reached in October 2009.

Republicans are poised to take control of the U.S. House and narrow Democrats’ margin in the Senate, delivering a rebuke to President Barack Obama’s party in a campaign shaped by voter anxiety over jobs and the economy.

Australia’s dollar rose to the highest level since it was floated in 1983, briefly trading above $1, as it strengthened against 15 of 16 major counterparts following the nation’s unexpected interest rate increase.

Oil and gas shares led the gains in Europe, as BP Plc climbed 1.8 percent and BG Group Plc rose 3.4 percent after earnings at both companies beat analysts’ estimates. Danske Bank A/S, Denmark’s largest lender, rallied 5 percent as profit rose. The MSCI Emerging Markets Index rose 0.4 percent.
http://www.bloomberg.com/news/2010-11-02/asian-stocks-dip-before-central-bank-meetings-yen-drops-from-15-year-high.html