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Morning Commentary

ENGINE REVVING UNDER THE HOOD

By Charles Payne, CEO & Principal Analyst
11/18/2020 9:28 AM

Perhaps Tuesday’s session was doomed from the start, but it was quite a down day. One could say it was a peculiar session that saw buyers emerge at low points, and when the final bell rang, market breadth was decidedly bullish.

Go figure!

Not only were there more advancers than decliners on the NY Stock Exchange and the NASDAQ Composite, and significantly more new highs than lows, but the volume also was extremely bullish.

There was almost 100% more up volume than the down volume on the New York Stock Exchange. This is huge, and investors should keep that in mind as there will be more calls for a broad market pullback and potentially increased volatility.

Market Breadth

NYSE

NASDAQ

Advancing

1,727

1,837

Declining

1,339

1,716

52 Week High

136

176

52 Week Low

3

12

Up Volume

3.16B

2.40B

Down Volume

1.66B

1.72B

The Stock of the Day

Tesla (TSLA) got the S&P 500 nod, but yesterday, the stock of the day was Kohl’s (KSS). KSS released financials that missed on revenue, beat on earnings but saw a large comp-store decline. The stock opened down to more than 3% to $25.38, then turned around and closed at $29.18. Other compelling retailers:

Home Sweet Home

Homebuilder sentiment has gone through the roof!

The headline read of 90 for November is a record high and well above the consensus of 85. It’s all about the massive stampede of folks from those large urban cities. Even before coronavirus, the National Association of Home Builders (NAHB) index was moving higher, in part to older millennials forming households and moving out of big cities.

It’s all about the single-family home, which might not have the white picket fences anymore. But it is a throwback to different times in the United States.

NAHB Sentiment

Record Prospective Homebuyer Traffic speaks to future ownership levels and investment opportunities.

Hotline Model Portfolio Approach

We took profits in Industrials and added a new position to Industrials yesterday, and this morning, we are adding to Healthcare in the Hotline Model Portfolio. 

Today’s Session

The advance-decline line is at a new high, suggesting a much more upward upside for the market.

More good news on a Covid19 vaccine from PFE and BioTech, showing the vaccine was 95% effective in its Phase 3 trial, and the companies will move to getting an Emergency Use Approval.

Boeing’s (BA) 737 max is finally cleared for take off by the FAA.  Shares are soaring up over 7%.


Comments
Good report! Love you online anytime you speak Charles!

Lorin K on 11/18/2020 10:59:15 AM
 

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