Morning Commentary
Yesterday, it finally happened. It took some time, but the Dow Jones Industrial Average (DJIA) is finally in the hunt to achieve new record levels.
All those nascent efforts to rotate stock-buying into value from growth will morph into something substantial - and dare I say, something powerful. As I have been writing for weeks, this rotation was bound to happen. The only question was: could the impact on big tech and communication names cause large indices to move lower, even as the breadth of winners widened?
Initially, the NASDAQ Composite limped along; even the S&P 500 wasn’t on firm footing, as investors rediscovered blue-chip names. Just as I said, new highs for the S&P 500 would trigger automatically, forcing all those fund managers that missed the bounce to put money to work. It is their gig, after all. There would not be as much pressure to buy on a DJIA breakout to new highs. However, many in the media will finally say, “the market is at all-time highs,” and that creates a positive feedback loop.
Dow Jones Industrial Average
The Bluest Chips
Buyers moving into Dow names went for some of the worst performers of the year, and those names gave a different meaning to “blue-chips.”
One phenomenon we are going to see are mundane names with very low-beta tech make moves that are more typical of high-beta tech:
Symbol |
Company Name |
Last Price |
% Change |
Volume |
WMT |
Walmart Inc. |
147.68 |
+0.06% |
17,205,624 |
CVX |
Chevron Corporation |
83.19 |
+0.13% |
10,822,137 |
CSCO |
Cisco Systems, Inc. |
42.42 |
+0.93% |
30,045,675 |
HD |
The Home Depot, Inc. |
287.20 |
+0.97% |
3,250,984 |
WBA |
Walgreens Boots Alliance, Inc. |
37.17 |
+1.12% |
7,358,669 |
DIS |
The Walt Disney Company |
135.39 |
+1.38% |
7,655,677 |
V |
Visa Inc. |
216.48 |
+1.47% |
9,508,872 |
JPM |
JPMorgan Chase & Co. |
101.65 |
+1.51% |
13,997,101 |
JNJ |
Johnson & Johnson |
153.83 |
+1.52% |
6,706,009 |
BA |
The Boeing Company |
174.78 |
+1.56% |
16,277,422 |
CRM |
salesforce.com, Inc. |
276.69 |
-1.62% |
12,645,614 |
MCD |
McDonald's Corporation |
216.23 |
+1.66% |
4,091,443 |
PG |
The Procter & Gamble Company |
140.51 |
+1.69% |
7,570,945 |
NKE |
NIKE, Inc. |
116.80 |
+1.71% |
6,235,476 |
AXP |
American Express Company |
104.40 |
+1.88% |
3,454,064 |
MSFT |
Microsoft Corporation |
231.65 |
+1.93% |
34,080,839 |
AAPL |
Apple Inc. |
131.40 |
-2.07% |
200,118,991 |
CAT |
Caterpillar Inc. |
149.27 |
+2.20% |
4,515,050 |
GS |
The Goldman Sachs Group, Inc. |
210.04 |
+2.23% |
3,384,523 |
VZ |
Verizon Communications Inc. |
60.53 |
+2.32% |
21,398,901 |
UNH |
UnitedHealth Group Incorporated |
320.24 |
+2.37% |
2,628,319 |
TRV |
The Travelers Companies, Inc. |
117.48 |
+2.43% |
1,249,166 |
HON |
Honeywell International Inc. |
172.47 |
+2.68% |
3,994,463 |
MMM |
3M Company |
169.51 |
+2.86% |
3,739,411 |
INTC |
Intel Corporation |
52.25 |
+2.87% |
53,000,730 |
AMGN |
Amgen Inc. |
258.12 |
+2.89% |
2,871,599 |
MRK |
Merck & Co., Inc. |
86.93 |
+2.96% |
10,826,088 |
IBM |
International Business Machines Corporation |
128.18 |
+3.87% |
6,337,507 |
DOW |
Dow Inc. |
49.22 |
+4.13% |
6,952,216 |
KO |
The Coca-Cola Company |
51.19 |
+4.21% |
25,203,96 |
Year-to-Date
Market breadth was powerful, as new highs outpaced new lows by a 7:1 ratio, but it was up the volume on the NYSE that was the highlight of the session
Market Breadth |
NYSE |
NASDAQ |
Advancing |
1,948 |
2,069 |
Declining |
1,030 |
1,334 |
52 Week High |
165 |
262 |
52 Week Low |
12 |
49 |
Advancing |
3.08B |
2.25B |
Declining |
1.28B |
1.70B |
Get Ready
I never met a girl who makes me feel the way that you do
(It's alright)
Whenever I'm asked who makes my dreams real
I say that you do
(you're outta sight)
So fee fi fo fum
Look out baby 'cause here I come
And I'm bringing you a love that's true so get ready
So get ready
I'm gonna try to make love to you so get ready
So get ready here I come
-The Temptations
It was revealed yesterday that the Centers for Disease Control and Prevention (CDC) has told states to get ready to make way for the distribution of a COVID-19 vaccine by November 1st.
The “CDC urgently requests your assistance in expediting applications for these distribution facilities, and, if necessary, asks that you consider waiving requirements that would prevent these facilities from becoming fully operational by Nov. 1, 2020.” - CDC Director Robert Redfield
The federal government wants to make sure regulatory hurdles are quickly removed, so a safe and effective vaccine can be provided to the general public as swiftly as possible. The most optimistic scenario has two million doses ready by the end of next month, followed by up to 20 million by the end of November.
These are optimistic goals, and even if achieved, it will be politicized. But not even politicians and the media would be able to curb the spike in hope for Americans upon such news.
That would be something, especially if it’s coupled with the normal increase in confidence and optimism that comes with the stock market hitting all-time highs.
The wealth effect meets the health effect.
Portfolio Approach
We added to Technology yesterday in the Hotline Model Portfolio.
Today’s Session
Stocks have been under pressure all morning, but that’s a natural reaction after a monster session like yesterday.
Initial jobless claims came in better than expected at 881,000 against consensus of 950,000. The nation has come a long way from 6.867 million initial jobless claims back in May. The news turned around the Dow Jones Industrial Average; albeit, by a small margin.
Initial Jobless Claims
Rotation Picks Up Steam
Sharp pullbacks on better than expected news will frustrate a lot of investors today. I already had someone reach out this morning complaining about CrowdStrike (CRWD). Yes, after a 185% move, even great news is discounted. If you are a long-term investor, you invite occasional pullbacks. We are getting them in Technology and Communication Services.
CLDR +14% 2020
-Guidance
PD +49% 2020
-Guidance: Below Street
SMAR +33% 2020
-Guidance:
CRWD +185% 2020
-Guidance:
Comments |
Great Report, and thanks for sharing your great knowledge. My question is; I'm close to investing in Gold and Silver coins, but with the stock market (I'm aggressive in the S&P) acting the way it is, do you think I should still peruse coins at this time. It seems gold and silver dipped a bit. Thanks, Joe Joseph P Sciascia on 9/3/2020 9:49:59 AM |
Tweet |
4/19/2024 1:20 PM | Fair Chunk of Rotation |
4/19/2024 9:35 AM | DON’T OVERREACT |
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 |
More commentary archives |
Home |
Products & Services |
Education |
In The Media |
Help |
About Us |
Disclaimer | Privacy Policy | Terms of Use | All Rights Reserved.
|