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Morning Commentary

NASDAQ RIPPING

By Charles Payne, CEO & Principal Analyst
4/3/2019 9:06 AM
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It was a down session for the Dow Jones Industrial Average on Tuesday. Nonetheless, it was a good day in so many ways, as it underscored the pendulum of fear that has swung from losing money to losing opportunities. While it’s clear Wall Street isn’t worried about the border with Mexico being closed, the market moved into a higher gear upon hearing President Trump say Mexico was doing more, suggesting the drastic action was avoidable.

There was an element of value-buying in the session reflected in intraday buying in the Materials (XLB) sector.

S&P 500 Index

+0.00%

Communication Services (XLC)

+0.53%

Consumer Discretionary (XLY)

-0.02%

Consumer Staples (XLP)

-0.82%

Energy (XLE)

-0.69%

Financials (XLF)

-0.08%

Health Care (XLV)

-0.23%

Industrials (XLI)

-0.04%

Materials (XLB)

+0.34%

Real Estate (XLRE)

+0.86%

Technology (XLK)

+0.35%

Utilities (XLU)

+0.14%

 
NASDAQ On Fire

It’s not even close. The NASDAQ Composite has shifted into the next gear, leaving all the other major equity indices in the dust. 

The index was higher yesterday. It’s in the shadows of its all-time high point, while on the cusp of the so-called ‘Golden Cross,’ where the 50-day moving average crosses above the 200-day moving average.

NASDAQ Composite

The ‘Golden Cross’ shouldn’t be confused with the famous William Jennings Bryan “Cross of Gold” speech at the Democratic National Convention on July 9, 1896.

"You shall not crucify mankind upon a cross of gold.”

That speech lured populists to support Bryan, and many are saying it’s being resurrected by many Democratic candidates these days. The great news is that as the economy and the market continue to surge, Americans shouldn’t panic and vote against their own pocketbooks and wallets.

Portfolio Approach

No changes in the model portfolio.

Communication Services

1

Consumer Discretionary

4

Consumer Staples

1

Energy

1

Financials

1

Healthcare

2

Industrial

4

Materials

3

Real Estate

0

Technology

2

Utilities

0

Cash

1

 

Today’s Session

Trade negotiations with China continue today in D.C.  Investors are optimistic that positive movement is being made on several trade issues. Futures have been up all morning across all the major indices.  Although, futures have dipped a bit after the ADP report for March was released.

The private sector added 129,000 jobs in according to the ADP National Employment report, which was the slowest employment increase in 18 months.   

The Goods Producing sector saw overall declines, down 6,000 while the Service Producing sector added 135,000 jobs. 

Good Producing -6,000

Service Producing +135,000

Mining +2,000

Trade, Tran & Utility +9,000

Construction -6,000

Information +11,000

Manufacturing -2,000

Financial Activities -1,000

 

Professional & Business +41,000

 

Education & Health +56,000

 

Leisure & Hospitality +13,000

 

Other +6,000

 

Mark Zandi, chief economist of Moody’s Analytics, said, “The job market is weakening, with employment gains slowing significantly across most industries and company sizes. Businesses are hiring cautiously as the economy is struggling with fading fiscal stimulus, the trade uncertainty, and the lagged impact of Fed tightening. If employment growth weakens much further, unemployment will begin to rise.”

Small business, had the smallest gain, adding only 6,000 jobs, however, it lost 9,000 in the 1-19 employees segment.

Business Size

Change

Small 1-49           Employees

+6,000

Midsize 50-499 Employees

+63,000

Large 500 or more Employees

+60,000

 

Investors will be cautiously anticipating the all important Friday Job’s Report.

 

 

 

 

 


 

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