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Morning Commentary

Trying to Find Footing

By Charles Payne, CEO & Principal Analyst
3/31/2021 9:39 AM

The market regained its equilibrium yesterday.  But there was enough doubt to keep all the major indices in the red, as a last-minute rally fizzled out right before the closing bell.  The NASDAQ erased the largest decline, as some buyers went from tire-kickers to nibbling on weakness.  The Russell regained its winning ways, rallying 1.72% on the session.

Market breadth was better, but losers continue to suffer.  Selling begets selling, resulting in more stocks hitting 52-week lows than highs on the NASDAQ.

Market Breadth

NYSE

NASDAQ

Advancing

2,067

2,467

Declining

1,235

1,670

52 Week High

119

73

52 Week Low

37

95

Up Volume

2.69B

3.13B

Down Volume

1.32B

1.53B

 

Small Caps Lead the Way

The Russell 2000 continues to outperform its larger broad equity index brethren. It appears ready to move higher and maybe retest the recent high.

The index is trading below its 20-day moving average but holding well above its 200-day moving average, which suggests near term oversold conditions, but long-term upward bias is firmly intact.

Portfolio Approach

We continue to have only one cash position open and a long list of potential buys.

Today’s Session

The official unveiling of President Biden’s Infrastructure plan will happen today, of which less than a third is earmarked to go towards fixing bridges and roads.

Jobs will also come into focus as well.  We got the ADP Employment report today. There were 517,000 jobs created against consensus of 550,000.

ADP Report

There is a lot of excitement that the Friday jobs number could peak above one million for March. 

Interestingly, I’m not sure the street wants a great jobs report because of all the chatter about inflation.  I think a great jobs report speaks to better underlying fundamentals for a rally that would rely more on organic growth than money printing. Although, I admit, the street cannot be let off the Fed money printing hook for a couple of years.

Meanwhile, data from Indeed shows new job posting growth beginning to slow.

 

The market is stabilizing and wants to go higher.  Bond yields are an issue and leadership the other.

There have been a lot of head fakes.  Let'ssee how things go.


Comments
Inflation is cooooooming!

Lorin K on 3/31/2021 11:15:34 AM
Doing a great job Charles. I can see you are are constantly on the job and I enjoy your educational comments. I constantly worry and wonder about our country thinking of the future of our children. Joe Biden is a nigh mare and his handlers and his administration is well on their way destroying our country and way of life. Someone needs to belly up and have a real conversation with him excluding his handlers because I am sure he knows not what he is doing. If he does he is worse than a nigh mare and needs to step out of the position he is occupying. Sorry to go on but this bothers me a bunch and should bother everyone that cares about our country. Anyway, just wanted to thank you for your educational and informative shows each day. Thanks again!

Lanny Hope on 3/31/2021 1:23:30 PM
The gold bottom is here. Buckle up for the ride😘.

Lawrence D on 3/31/2021 4:35:45 PM
Thanks Charles - enjoy your show on Fox Business, and appreciate all your great insights!

Bert B on 3/31/2021 8:48:21 PM
The name of the game is "Beat inflation, and beat it by a lot!"

Patrick J Pedley on 3/31/2021 10:35:33 PM
 

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