“We would lose. That's what we're programmed to do.”

Archer, the Gorgon Emissary

“Small Soldiers”

It was beginning to look like stocks would never put up a fight on Monday. We are talking going beyond program-trading to being programmed to lose every day. It was green on the screen. We haven’t seen that in a while; a broad market rally, led by Technology, Communication Services, Financials, and Consumer Discretionary. Safe havens were down earlier in the session for late buyers.  

S&P 500 Index	+1.55%
Communication Services (XLC)	+2.28%
Consumer Discretionary (XLY)	+2.24%
Consumer Staples (XLP)	+0.13%
Energy (XLE)	+1.50%
Financials (XLF)	+2.04%
Health Care (XLV)	+0.97%
Industrials (XLI)	+0.73%
Materials (XLB)	+1.14%
Real Estate (XLRE)	+0.21%
Technology (XLK)	+2.26%
Utilities (XLU)	+0.59%

Market Breadth

Finally, advancers and up volume swamped decliners and down volume, but there were only 14 new 52-week highs on the NYSE against 146 new lows. And on NASDAQ, there were 19 new highs against 122 new lows.

Technical View

This week, fundamentals continue to take a backseat to other things, including negative speculation and technical breakdown. The emotional stuff reared its ugly head yesterday morning after President Trump reiterated higher tariffs coming in January and noting that not even Apple (AAPL) will be spared.

Meanwhile, charts haven’t mattered much, but that could be changing. Yesterday’s low was a key support point, going back to June, and even earlier in the year. If it looks like the key support will hold, it could attract more buyers later in the session.

All the buying will be cautious until the Dow Jones Industrial Average closes above 26,000.

Conversely, if 24,172 fails this week, it could open a trapdoor.

Dow Jones Industrial Average

Value & Takeovers

Just as individual investors are seeking value, there are many businesses and industries that look ripe for consolidation. 

Watch the Cloud space, which is still reverberating after IBM made its largest acquisition by far. Also, watch for insider buying, such as the big chunk of shares bought by the CEO of Newell Brands (NWL), propelling the stock to the top of the Consumer Discretionary.

Unlocking value is another technique that might get a lot of attention.  After the close, United Technologies (UTX) announced it would split itself into three separate businesses.

Of course, Wall Street likes when companies unlock value by laying folks off, which explains the big spurt in shares of General Motors (GM) yesterday. The White House is not thrilled with the company, which just posted a monster quarter, and they can’t shift production to successful trucks and crossovers, even to the right car model.

GM CEO Mary Barra met with Larry Kudlow at the White House; perhaps there could be some compromise.

Jobs Conundrum

The Dallas Fed report with ‘special questions’ on finding workers underscores how hard it is to fill those mid-skill level positions.  

There has been a decided surge in low-skilled positions and mid-skill positions (what some are calling “new collar” jobs) since last year.

Ironically, there was a decline in high-skilled positions, which will make a lot of parents wonder about those expensive degrees.

Perhaps most alarming is the lack of applicants for these jobs. There is something very wrong with a nation that has seven million job openings and yet, so many businesses can’t find workers.

Dallas Fed Report

If you are having problems finding qualified workers, in which categories are you experiencing difficulty? Please check all that apply.*

Today’s Session

Tweet

 

Home | Products & Services | Education | In The Media | Help | About Us | Disclaimer | Privacy Policy | Terms of Use | All Rights Reserved.