On Monday, the market tumbled out of the gate. While major indices, save for the NASDAQ Composite and the Russell 2000, struggled throughout, they were never in danger of a big selloff.

Market breadth was impressive on the NASDAQ, which saw 1,252 more advancers than decliners, and only 18 new 52-week lows. But the 3.5 billion up volume was the most bullish part of the session, far outpacing 983 million down volumes.

Market Breadth	NYSE	NASDAQ
Advancing	1,882	2,765
Declining	1,442	1,513
52 Week High	384	261
52 Week Low	10	18
Up Volume	2.56B	3.50B
Down Volume	1.75B	983.28M

There was a slight divergence in the iShares Russell 1000 Growth (ETF), which was higher, and the iShares Russell 1000 Value (ETF), which was lower.

Message from Blue Chips

For most of the session, there were only two winning sectors, Health Care and Real Estate, but three others edged into the plus column for the closing bell. 

S&P 500 Index		-0.08%
Communication Services XLC	+0.52%
Consumer Discretionary XLY	0.00%
Consumer Staples XLP		-0.18%
Energy XLE		-0.43%
Financials XLF		-0.65%
Health Care XLV	+0.35%
Industrials XLI		-0.69%
Materials XLB		-1.22%
Real Estate XLRE	+0.94%
Technology XLK		-0.02%
Utilities XLU	+0.18%

Communication Services were the most compelling, led by Google (GOOGL) and Facebook (FB). 

Consumer Credit

Consumer credit in April saw  revolving debt decline by 2.4%, as non-revolving debt edged up to 7.6%.  The $18.6 billion net was unchanged after March was revised down to $18.6 billion, from an initial report of $25.8 billion.

Consumers continue to display discipline when it comes to credit card debt.

Consumer Credit Trends	2016	2017	2018	2019	2020	Q120	2Q202	3Q20	4Q20	1Q21	Feb 21	Mar 21	Apr 21
Total % change (annual rate)2	6.9	5.3	4.5	4.6	-0.2	0.6	-5.6	1.9	2.2	3.0	5.2	5.3	5.3
Revolving	6.9	5.9	3.7	3.6	-11.2	-7.1	-31.0	-4.1	-3.7	-3.7	3.8	1.7	-2.4
Nonrevolving	7.0	5.1	4.8	5.0	3.6	3.4	3.2	3.7	4.0	5.0	5.6	6.4	7.6
Total flow (annual rate)	236.2	194.3	172.7	185.5	-9.5	26.5	-234.0	76.8	92.7	124.5	218.7	223.0	223.3
Revolving	62.0	56.7	37.3	38.1	-122.1	-77.7	-334.1	-40.6	-36.0	-36.3	36.9	16.6	-23.5
Nonrevolving	174.2	137.6	135.3	147.4	112.6	104.2	100.1	117.4	128.7	160.8	181.8	206.4	246.9
Total outstanding	3,636.4	3,830.8	4,007.0	4,192.6	4,187.8	4,203.9	4,145.4	4,164.6	4,187.8	4,218.9	4,200.3	4,218.9	4,237.5
Revolving	960.1	1,016.8	1,053.8	1,092.0	974.6	1,077.3	993.8	983.6	974.6	965.5	964.1	965.5	963.6
Nonrevolving	2,676.3	2,813.9	2,953.2	3,100.6	3,213.2	3,126.6	3,151.6	3,181.0	3,213.2	3,253.4	3,236.2	3,253.4	3,273.0

Certainly, consumers are flush enough to give the economy a major lift as more Americans venture outside.

Visiting Stores & Restaurants

According to Gallup, more Americans are visiting stores other than the supermarket. And an equal percentage reported visiting a restaurant in the past day, but only 26% have dined inside. I think these numbers are going to surge, and there will be a positive market reaction.

Portfolio Approach

Yesterday, we added a new position in Materials in our Hotline Model Portfolio.

Today’s Session

The ten year bond yield is easing again, and now at its lowest point in more than a month, and its nearing a support point that could trigger even deeper declines.

NFIB

Small businesses continue to feel uneasy, and this has overall optimism moving sideways, but looking vulnerable.

The top three concerns are quality workers (26%), taxes (22%) and government (13%).

Key trends from the NFIB Small Business report continued to be worrisome.  The number of companies reporting few or no qualified job candidates continues to soar along with open positions, which is now at a record high of 48%, significantly above the historic average of 22%.  This is coming at a time when more small businesses say they plan to hire.

Comments

We, my wife and I, have been doing our part. We've been out to a dine in dinner, in side, at various eateries everyday of the week since they have opened back up! Lorin K on 6/8/2021 10:19:36 AM

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