It was another bifurcated session for the market that saw the Dow Jones Industrial Average and the S&P 500 climb to new record levels as profits continued to rotate out of technology on Tuesday.

Consequently, the NASDAQ saw more decliners (1,633) than advancing stocks (1,290) while names hitting new 52-week lows climbed to 52.

By the same token, there were more losers than winners on the NYSE as well. There were huge gains by Boeing (BA) on news of an increase in its dividend and share-repurchase program that powered the index higher.

Banks Leading the Way

Normally, deteriorating internals (when you have more decliners than advancers) and an increasing number of stocks hitting new lows is a red flag. There was the additional action that actually gave me confidence. Investors bolted out of the safe haven of utility stocks and into financials ahead of today’s potential rate hike. 

This move bodes well for the overall economy, and the possibility of banks actually lending money again.

Now, it’s just a matter of the GOP getting its act together.  While it’s not everything it could have been, I’ve spoken to enough folks in charge who feel confident it’s a done deal, and it will have an overwhelmingly net positive impact on the economy.

Today’s Session

There’s lots of news on the docket today including the last push on tax reform and potential rate hike by the Federal Reserve.  On the former, I think the action in the Russell 2000 underscores the fact the bill is more beneficial to multinational companies like Boeing than domestic businesses.

That said, the market wants and needs to see tax reform finished and put into the can.  There is a greater sense of urgency with the election of Democrat Doug Jones to the Senate.

As for the Fed the rate hike, it will not be news.  However, the statement, and how the market reacts to the statement, will be a great gauge on how the street will react to potentially three additional rate hikes in 2018.