As we say “See ya!” to the third quarter, everyone is focused on oil, trouble-making banks and the presidential race.

Crude is wobbling as the doubt ramps up about OPEC’s “deal” to cap output, which sent prices soaring yesterday. If you haven’t figured out the details, do you really have a deal?

Worries about the world’s banks aren’t going away, as Germany’s Commerzbank CBK, -0.53% suspends its dividend and cuts 9,600 jobs. Cue the first warning that Wells Fargo’s WFC, -1.62% sales-stuffing scandal is a “harbinger of doom.”

Sure, Pimco is predicting continuous global expansion through next year. But then it frets that politics could “trump economics” and suggests being modestly underweight stocks.

So what’s in store in the upcoming quarter? Well, the end of the year has typically been quite kind to the S&P 500 — but you know what they say about past performance.

“History reminds us that the S&P 500 SPX, +1.05% gained an average of nearly 4% in Q4 since 1945 and rose in price more than 70% of the time,” notes S&P Global Market Intelligence’s Sam Stovall.

Except this time, a bunch of factors — declining earnings, elevated valuations, election uncertainty and a possible December rate hike — could end up squelching “end-of-year optimism,” Stovall says.

Our call of the day is fodder for the bulls, but only a bit. It comes from Oaktree Capital’s Howard Marks, who doesn’t see bubbles forming and isn’t going to cash, though he still argues for caution.

Today’s chart is all about the bad big banks.

Key market gauges

S&P futures US:ESZ6 and Dow futures US:YMZ6 are dipping, indicating stocks might catch their breath after the Dow DJIA, +0.51% scored triple-digit gains for two days in a row. Europe SXXP, +0.20% and Asia have been in the green, as energy stocks there got a lift from yesterday’s OPEC news.

West Texas Intermediate crude CLX26, has been choppy this morning as traders scratch their heads about that production-cut agreement. Gold US:GCZ6 is falling and a key dollar index DXY, +0.19% is higher.

The call

“I’m not seeing bubble prices in most assets,” says Oaktree’s Marks in a Bloomberg TV video. “The S&P, for one indicator, sold at 32 times earnings in 2000, and it’s at about 19 today. There’s a big difference between 19 and 32.”

It’s healthy that people are talking about risks in the markets, he says.

“You don’t see raving bulls. They have not reissued ‘Dow 36,000,’” Marks says, referring to a notoriously bullish book.

Marks, ICYMI, has been called one of the 67 greatest investors ever, and Warren Buffett has said he always pays attention to this particular fellow billionaire’s musings.

The Oaktree co-chairman says his shop has been investing for the past five years, but with unusual caution, and it’s aiming to be “selective.”

What about the potential bear market for bonds that investors have been worried about?

“This is not the kind of thing that we concern ourselves with at Oaktree. We are not market timers,” he says. “The thing I dislike the most is the word ‘trader.’ We are not traders. We are long-term investors, and if we can buy the debt of a company that we are convinced will pay off — at an attractive yield, given the risk — we’re going to buy it and hold it.”

Big institutions should be expecting returns of 5.5%, rather than the 7% to 8% they used to get, adds Marks (who endorsed Hillary Clinton, albeit with caveats).

“If I were running a fund, and somebody said to me, ‘What return do you think you’ll get, with modest-to-moderate risk over the next X years?’ I’d probably say five and a half.”

Go here for the full video where Marks makes these comments. Plus, Collaborative Fund’s Morgan Housel has his own take on bubbles here.

The chart

@DavidSchawel

With banks in the spotlight this week, New River Investments Inc.’s David Schawel has shared the chart above, which illustrates how the big boys have grown.

In other bankster news, the CEO of a European bank is saying don’t invest in European banks, and 86% of Americans think Wells Fargo boss John Stumpf should resign, according to a SurveyMonkey poll.

The buzz

Getty Images

Pepsi PEP, +0.69% and ConAgra Foods CAG, +0.31% are both gaining premarket after posting earnings before the open.

In unicorn news, quote-to-cash startup Apttus is now valued at more than $1.3 billion and looking to IPO.

National Amusements, controlled by Sumner Redstone and his family, this morning has asked CBS US:CBS and Viacom US:VIA to consider merging, in a move that had been expected.

Regulators in Wells Fargo’s home state have taken aim at the bank, while other regulators are looking into Samsung 005930, -0.51% SSNLF, washing machines that are now also exploding.

This year’s Paris Motor Show is about electric cars and brands skipping the event.

On the political front, Newsweek is reporting that Donald Trump’s company violated the U.S. embargo against Cuba (which nowadays is no longer in effect). The reaction to this scoop might underwhelm, and this tweet helps explain why:

The economy

Ahead of the open, U.S. GDP growth for the second quarter was raised to 1.4% from 1.1%, and jobless claims came in a little below forecasts. A reading on pending home sales is expected shortly after the open.

It’s another big day for Fed chatter, after lots of speakers yesterday. Fed Gov. Jerome Powell is expected to speak at 10 a.m. Eastern Time, and Neel Kashkari from Minneapolis and Janet Yellen are slated to sound off in the afternoon.

Check out:MarketWatch’s Economic Calendar

Earlier this morning, the Philly Fed’s Patrick Harker said the central bank is at risk of falling behind the curve on inflation if it does not normalize rates sooner rather than later, as Reuters noted, while the Atlanta Fed’s Dennis Lockhart said it won’t be long before a hike.

The stat

Nearly 60% — That’s how much of the S&P 500’s gain since January 2008 has come on the 70 Fed announcement days, according to a Wall Street Journal column by Morgan Stanley’s Ruchir Sharma.

Donald Trump’s riff that the increasingly political Fed is creating a bubble has some truth to it, Sharma argues.

Read more:Trump’s “ugly” claim about stocks is backed by Morgan Stanley economist

The quote

“I would venture to say that this is the single most embarrassing thing that the United States Senate has done, possibly, since 1983.” — White House press secretary Josh Earnest, blasting the override of President Obama’s veto.

The current commander-in-chief had aimed to block families of 9/11 victims from suing countries that have allegedly sponsored terrorist acts, arguing the bill in question could be applied too broadly and hamper future diplomatic efforts.

See:Congress overrides Obama veto of bill allowing 9/11 suits against Saudi Arabia

Random reads

Facebook, Google and Microsoft are teaming up to soothe fears about artificial intelligence.

If you were hoping to bid on punching Martin Shkreli, you missed your chance.

For the first time ever, Playboy has featured a woman wearing a hijab.

High blood pressure in kids, largely due to obesity, may impair their cognitive skills.

What do business leaders do before bed? Read, take a bath, meditate, turn off the phone.

22% is the magic number when it comes to how much millennials should be saving.

Wake up and smell what today is:

Need to Know starts early and is updated until the opening bell, butsign up hereto get it delivered once to your email box. Be sure to check the Need to Know item. The emailed version will be sent out at about 7:30 a.m. Eastern.

Andsign up hereto get the Friday email highlighting 10 of the best MarketWatch articles of the week.