“While markets often make double bottoms, three pushes to a high is the most common topping patterns” — J. Bollinger

1. GE Considers More Asset Sale — General Electric is considering options for its aircraft leasing unit, including the sale of all or part of the business, as CEO John Flannery searches for new divestitures, Reuters reports. With a fleet of 1,339 planes worth an estimated $25B, GE Capital Aviation Services ranks only behind AerCap (NYSE:AER) as the globe’s largest lessor.
2. Saudi Arabia ‘s Princes, Businessmen, Officials Arrested in Anti-Graft Drive — Saudi Arabia announced a new wave of arrests of royals and ministers in a Saudi corruption probe. It was orchestrated by Crown Prince Mohammed bin Salman, who’s backed OPEC-led output cuts. The purge also led to the arrest of business billionaire Prince Al-Waleed, whose investment firm Kingdom Holding has big stakes in Citigroup (NYSE:C) and Twitter (NYSE:TWTR).
3. Longest Overbought Streak For S&P 500 Since 2012 — courtesy of BIG, looking further back at the current bull market, there have only been three other periods where the S&P 500 closed at overbought levels for 40 or more trading days. The chart below shows the S&P 500 through the course of the entire bull market dating back to March 2009. As shown, two of those prior streaks occurred within ten trading days of each other when a 45-trading-day streak ended on 11/12/10 and another one began on 12/1/00. In both the one and six months that followed these prior streaks coming to an end, the S&P 500 was up all three times.

4. Democrats Win Big in Elections — Democrats scored a number of closely watched elections last Tuesday, in what some called a referendum on President Trump. Republicans lost races for governorship in Virginia and New Jersey, as well as control of the Washington state Senate. Mayoral races, too, produced a string of Democratic victories, most notably in New York City, where Mayor Bill de Blasio cruised to a second term.
5. U.S. Oil Service Firms Face Big Write-offs as Venezuela Nears Default — As Venezuela teeters on the edge of default, U.S. oil service companies face the prospect of hundreds of millions of dollars in write-offs for overdue payments from the PDVSA state-run oil company. Halliburton (NYSE:HAL), Schlumberger (NYSE:SLB), Weatherford (NYSE:WFT) and Baker Hughes (NYSE:BHGE) all hold outstanding bills and receivables, according to Reuters, which cited the most recent financial reports.
6. High-Yield Bond in Correction — The two largest junk bond ETFs, State Street’s (JNK) and BlackRock’s (HYG), are at their lowest levels in seven months as declines and fresh outflows inject volatility into the asset class. The downward movement has been intensified by lackluster quarterly results by some of the largest high-yield bond issuers, which are often among the biggest holdings of the popular ETFs. With high-yield bonds and the tech-heavy index of Nasdaq 100 stocks moving in tandem for most of their history, a recent breakdown in correlation suggests the selloff gripping junk is set to spread farther.

The week ahead — Economic data from Econoday.com: