Morning Commentary
It was a sluggish session overall yesterday, but breadth pointed to core strength, while we learned a couple of things about the market and investors.
-0.07% |
||
+0.29% |
||
+0.56% |
||
+1.52% |
||
+0.25% |
||
+0.08% |
||
+0.30% |
||
-0.51% |
||
+0.00% |
||
-0.93% |
||
+0.70% |
Leadership
The market has been riding the coattails of technology for years, especially in 2017 where just five names accounted for a majority of the overall gains. Maybe we got a glimpse into the possibilities of a rally composed of different leadership.
Case in point, there were only two losing sectors yesterday, my beloved material names and technology. Sharp declines on big volume in tech underscore the notion that the momentum crowd doesn’t ask questions on the way up or the way down.
It was brutal.
Breadth
But market breadth was essentially bullish pointing to core strength in leadership names.
NYSE saw more winners than losers as 166 names hit 52-week highs against 57 new lows.
NASDAQ had fractionally more losers than winners, but there were 275 new 52-week highs against only 31 lows.
Message of the Market
There is lots of talk about rotation, as the NASDAQ took it on the chin. I have to say however, over the last three months, its hasn’t been the most dazzling index. The Russell 2000 has gotten some attention, but those brick and mortar retailers have rocked them all.
I actually asked subscribers to take profits on a few names but looking for value in the industry.
Index Perofmance |
Year to Date |
3 Months |
NASDAQ |
10.6% |
2.8% |
Dow Jones Industrial Average |
2.1% |
1.4% |
S&P 500 |
3.6% |
1.2% |
Russell 2000 |
8.6% |
6.1% |
Retail Index (XRT) |
8.7% |
9.7% |
The search for value focused on energy stocks as crude edged up 1.68%. At some point, these oil stocks are going to rally higher, and everyone should have exposure. I think West Texas Intermmediate has to get to $73.00 for the true value in the underlying equityes to be realized.
The big question is could this market rally without tech? Its hard to imagine going from the locomotive to the caboose, but there will be more pressure this morning.
Reports out of Asia that Apple has warned its suppliers of a 20% decline in new iPhone parts orders is adding to the pressure. We’ve heard this before and almost everytime the reports proved to be incorrect.
It’s been a strong week for the market, so yesterday’s weakness and early morning pressure today are needed to test the resolve.
For the Dow Jones Industrial Average, there could be a test of 25,000 as support because it has been such an important technical number, but I don’t think that happens as money rotates into Blue Chips and value.
Group of Seven Showdown
I think Justin Trudeau's posturing is almost comical, l but it also hides the fact Canada hasn't been a fair trading partner with the United States. My tweet from yesterday underscores the fact Canada has massive tariffs to protect its key industries.
Tweet
Charles V Payne
@cvpayne
I know tariffs don't work but why does Canada have these tariffs?
270% dairy
69.9% Sausage
57.8% Barely Seed
49% Durum Wheat
26.5% Bovine/Meat
18% Table Linen
Why did Canada create "ingredient strategy" tariff in 2015?
To protect those important industries and curb US imports.
June 7, 2018
18,000 Likes
A New Group of Six: Don’t Make Me Laugh
I find Justin Trudeau comments that the other leaders are prepared to create a new organization without the United States a hollow threat and a big time diss at the fact America is the most important nation in any of these global alliances, including the G7, UN, NATO.
The G7 stated goal is to focus on economic governance, international security and energy policy. We know America is the nation that’s stopping tyrany from being unleashed onto the world. This year, the United States will become the number one producer of crude oil as Canada continues to squeeze crude out of sand.
This year GDP estimates in trillion USD:
Dreams of another CP-TPP
Trudeau was able to carve out some special goodies from the CP-TPP after America bowed out, including protectionism in the guise of supporting “cultural industries.” Could he be aiming at another coup?
Canada pushed for those special provisions making the case that “you don’t do trade in the 21 century like you did before.” When the deal was signed (without any IP protections), Canadian Minister of Trade, Francois-Philippe Champagne, bragged: “We got a better deal for Canada.”
Ultimately, I think America can forge better trading arrangements with our friends and foes Sadly, it seems this ham-fisted approach was the only way to achieve them.
Comments |
The US has been walked on for years in these "trade deals." I'm very thankful we have a leader with the resolve to correct these issues. Philip Morris on 6/8/2018 11:10:00 AM |
Tweet |
4/18/2024 1:37 PM | Didn’t Break Down |
4/18/2024 9:40 AM | MARKET OFF SCRIPT |
4/17/2024 1:59 PM | Facing Pressure |
4/17/2024 9:37 AM | POWELL STILL WANTS TO HELP |
4/16/2024 1:35 PM | Muted |
4/16/2024 9:42 AM | FEAR ARRIVES |
4/15/2024 1:17 PM | Making a Statement |
4/15/2024 9:45 AM | Equal Opportunity Drubbing |
4/12/2024 1:37 PM | Pressure Overall |
4/12/2024 9:42 AM | WHO YA GONNA CALL? |
4/11/2024 1:38 PM | No Urgency |
4/11/2024 9:27 AM | Tough Sledding |
4/10/2024 1:22 PM | Hang In There |
4/10/2024 9:51 AM | HERE COMES THE LATEST RATIONALE FOR PERSISTENT INFLATION |
4/9/2024 1:56 PM | Fighting the Trend |
4/9/2024 9:46 AM | NEXT TIME, MAKE IT A HOLIDAY |
4/8/2024 9:45 PM | Cautious Feel |
4/8/2024 7:19 AM | IT’S ECLIPSE DAY |
4/5/2024 1:51 PM | Higher and Cheaper |
4/5/2024 9:23 AM | MARKETS REEL ON BIDEN’S ISRAEL ULTIMATUM |
4/4/2024 1:42 PM | Stocks Bounce |
4/4/2024 9:31 AM | ESCAPING GRAVITY = ESCAPING REALITY? |
4/3/2024 1:41 PM | Cuts Not Soon |
4/3/2024 9:33 AM | A LITTLE LESS SWAGGER |
4/2/2024 1:16 PM | Under Pressure |
More commentary archives |
Home |
Products & Services |
Education |
In The Media |
Help |
About Us |
Disclaimer | Privacy Policy | Terms of Use | All Rights Reserved.
|