By: Kent Engelke | Capitol Securities

Markets surrendered gains and fell to a 0.5% loss following the tripling in volume of S & P 500 futures in 20 minutes after it was revealed that there were emails suggesting Russia backed Trump and was trying to damage Clinton. Approximately 30 minutes later, the averages were unchanged after the market concluded that the releases were nothing but noise.

Oil advanced following reports that American shale production will not be as great as previously expected given the collapse of infrastructure spending. Corporate approvals for new projects are at a 50-year low and existing oil fields are declining at a pace greater than expected.

This should not be a surprise given the $1 trillion dollar in infrastructure cuts since 2014, amounting to about 43% per annum from 2013 levels where large upstream production plans have all but been eliminated. Oil is a capital intensive industry.

Today, FRB Chair Janet Yellen testifies to Congress about the state of the economy and the direction of monetary policy. Will her statements also be regarded as “noise,” defined as nothing new will be offered?

Any time any Fed official speaks, can be of significance given their potential influence upon monetary policy and interest rates.

Last night, the foreign markets were mixed. London was up 0.88%, Paris was up 0.93% and Frankfurt was up 0.68%. China was down 0.17%, Japan was down 0.48% and Hang Sang was up 0.64%.

The Dow should open nominally higher as oil inventories were less than expected, but the direction can change radically if Yellen’s testimony is vastly different than expectations. The 10-year is up 2/32 to yield 2.35%.