Aspirational rallying is a good way to describe the tremendous relief markets have experienced in the wake of the Election; mostly since it's a given that both Congress and the Executive Branch can conceivably begin to function more efficiently, regardless of valid contentions that a Republican roadblock contributed to the gridlock of the past few years.

This market and the Country long for Washington to be productive. It goes beyond 'draining the swamp' to simply having the swamp function (if one wants to reflect on bringing some Establishment personages to work in the new Administration) and that's a sign of maturity that some people have to know their way around the 'Hill' and more. Markets like that, and as I've mentioned this week's actions mostly center around Oil.

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The assemblage of candidates for 'Secretary of State' illustrates clearly a willingness of President-elect Trump to contemplate diverging opinion or strategic view and his hubris seems sufficiently contained that he's not lunging toward polarized views, or even 'yes men' (or women) who seemed to be somewhat prevalent in the recent past. Our suspicion has been that he would not govern as he campaigned, and thankfully that's seemingly the case, where it counts on a global front. President Obama had a characteristic of replacing intelligence or military serious thinkers, as the dumbing-down of the CENCOM papers (Central Command out of Tampa had over 50 non-political analysts claim their work was entirely suppressed or distorted to make conditions appear other than as reality) and we don't see that kind of organizational structure going on here.

Clearly this market is on-hold and entitled to rest ahead of OPEC. That the Saudi's are still haggling with OPEC and non-OPEC members just a couple days before the Vienna gathering, reflects the absence of a deal and the ridiculous effort to try to bring Russia on-board with a production cut. This reflects the Saudi 'war on oil producers' launched 2 years ago as likely backfiring, not just because the Permian Basin has supremely held together (and expanded more recently) but because the Saudi's at this point are 'odd man out' in the fight against terrorism. Notice that the Syrians, with Russian backing augmented by their Carrier task force, has arrived within the past fortnight.

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They were clearly preparing for a big push on Aleppo and that's ongoing now. Of course the suffering is awful, but one should face it, the Russian involvement with Syria and Iran and Hezbollah is offsetting a lackluster US support of the so-called 'rebels', while there is a real US push to aid the Iraqis in their assault on Mosul, with an attempt to prevent Iraq from becoming even-more a vassal state satellite of Iran. Speaking of that, it now is learned that a US Navy helicopter over international waters right at the entrance to the Persian Gulf was 'aimed' at by weapons on a fast attack boat of the Iranians.. and the Pentagon is calling it reckless from the point of view of an unprofessional Iranian Navy. Little heard here.

Bottom-line:

The Arab nations and the Persians mostly hate each other sufficiently to scotch an oil deal before they wrap one up. Should they manage to cobble together a deal and you get Oil over 50 again; sure, it will rally the broad market temporarily.

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This is an aspirational market as investors and managers recognize the world is changing, led by the United States, not China, just as I believed for some time. We cannot however, emerge from the morass merely by politics; though the mood has changed tremendously for the better as we suspected. The bulk of the very near-term post-vote move is history, though there can be another fling. The recount efforts are futile efforts to raise funds, though there's little talk about Jill Stein having pulled votes away from the other candidates (presumably primarily from Clinton). I'd not expect the Election results to reverse and 2 of the three states that were believed pivotal just affirmed the votes; essentially saying so too. 

This is a very fluid overbought (short-term) market. So sure, 'now' risk is greater than rewards, so don't expect too much more. But given several ongoing factors (including the Italian referendum on shrinking a bloated government to 100 Senators from over 600, which is incredible, though not giving them voting power in their upper chamber is problematic with a lot of voters) ... and realization that the strong Dollar and credit market changes put challenges (that we've mentioned often) on multinational or global profits in 2017 (a year full of transitional proposals and initiatives) out there... contributes to the short-term prospects for this market.

The process of slowing the dramatically-bifurcated sector rotation shift; is occurring, although so far it's mostly related to shuffling with rumors of deals or no-deals stemming from OPEC and slightly from 'NOPEC' as a majority of non-OPEC oil producers are terms.

That's ongoing as a shift from credit markets persists; bond vigilantes are coming to the fore, but only gradually, and even Bulls increasingly are skeptical given rapidity of the move.

The Election has been a catalyst to shuffle money, as markets seriously reflect new dynamic American economic prospects; of course too much too fast is coming, but this swing is increasingly extended.