When I was in the U.S. Air Force, I had a roommate named LV Nelson from Tuscaloosa, Alabama, who always bragged about his town. He’d say: “Man, I know you from New York, but don’t sleep on T- Town.” Yesterday, Wall Street’s version of T-Town got a new member.

It was a strong session for the NASDAQ Composite, which had long enough coattails to bring the S&P higher into the close.

The so-called FAANG + M (MSFT) stocks were fantastic. Facebook (FB) set the stage with a huge legal victory over the Federal Trade Commission (FTC). The stock rallied 4.18% on 27.0 million shares (daily average is 17.7 million) and closed at a new high share price and a market cap of $1.008 trillion.

• Apple: $2.249 trillion
• Amazon: $1.73 trillion
• Google: $1.66 trillion
• Microsoft: $2.02 trillion

Message of the Market

It’s hard to believe that at one point, only three sectors were positive in the session, which finished with only three sectors in the red. The moves higher weren’t significant, but buyers emerged on the shallow dip points to growing tension for those on the sidelines to get in the mix.

The biggest winners of 2021 gave up big chunks yesterday as sellers rang the register to trot over to the next hot spot. 

S&P 500 Index	+0.23%
Communication Services XLC	+1.13%
Consumer Discretionary XLY	+0.02%
Consumer Staples XLP	+0.09%
Energy XLE		-3.38%
Financials XLF		-0.73%
Health Care XLV	+0.15%
Industrials XLI		-0.53%
Materials XLB	0.00%
Real Estate XLRE	+0.04%
Technology XLK	+1.05%
Utilities XLU	+0.64%

Market Breadth

There were more decliners than advancers on the NYSE and NASDAQ Composite. Volume was negative on the NYSE and very light on the NASDAQ.

Market Breadth	NYSE	NASDAQ
Advancing	1,387	2,109
Declining	1,997	2,312
52 Week High	150	207
52 Week Low	170	32
Up Volume	1.30B	2.73B
Down Volume	2.88B	1.46B

Coming in for a Landing

Airlines and cruise ships, and other reopening names were under significant pressure yesterday. I think some of that had to do with the continued surge of the Delta variant of Covid-19. Countries are erecting barriers again, including Hong Kong, blocking air traffic from the UK beginning on Thursday.

Interestingly, the United States is ranked number one on Bloomberg’s Covid Resilience Ranking.  I’m worried states, such as California, would take excessively effusive actions, like bringing back lockdowns. I hope that doesn’t happen.

Covid Resilience Ranking

RANK	ECONOMY	BLOOMBERG RESILIENCE SCORE	PEOPLE COVERED BY VACCINES	LOCKDOWN SEVERITY	FLIGHT CAPACITY	VACCINATED TRAVEL ROUTES
1	U.S.	76	50.3%	47	-20.1%	334
2	New Zealand	73.7	10.3%	22	-31.3%	140.5
3	Switzerland	72.9	41%	48	-69.9%	365.5
4	Israel	72.9	59.1%	22	-63.7%	134.5
5	France	72.8	40.3%	48	-59.3%	346.5
6	Spain	72	41.7%	54	-54.7%	365
7	Australia	70.1	14.2%	50	-35.3%	136.5
8	Mainland China	69.9	40.8%	78	1.7%	121.5
9	U.K.	68.7	57.1%	51	-77.8%	216.5
10	South Korea	68.6	19.2%	50	-46.4%	137
11	Norway	67.9	36.5%	59	-59.9%	133
12	Denmark	67.5	43.2%	50	-73.2%	173.5
13	Singapore	67	44.1%	58	-83%	137
14	Turkey	66.9	28.2%	63	-39.2%	354.5
15	Saudi Arabia	66.9	25.2%	54	-44.2%	349
16	Belgium	66.4	45.3%	51	-62.6%	170.5
17	Finland	66.1	38.1%	48	-83.2%	142.5
18	U.A.E.	65.8	70%	61	-59.9%	253
19	Greece	65.8	36.9%	45	-42.9%	187.5
20	Romania	65	23.2%	43	-33.2%	371

 U.K. REPORTS 22,868 NEW COVID CASES, MOST SINCE END OF JANUARY

Headlines like this aren’t hitting the market, but it looks like it’s influenced certain sectors.

The yield curve continues its rapid flattening. The spread between the 10- and 2-year bond yields is in freefall. The rise of the Delta variant is one of the reasons for this.

Ahead of the big jobs report, it should be noted the jobs continue to mount. Friday is going to be huge.

Remember how crummy stocks reacted to the greatest earnings season ever?  I don’t think that happens again this time around. Yes, comparable (s) are easy, but the absolute numbers are going to be huge. In the meantime, forward price-to-earnings (F P/E) ratios have gone much lower, even as the market has gone much higher.

It’s a couple of weeks away, but this earnings season should be huge.

Portfolio Approach

We took profits in Consumer Discretionary yesterday in our Hotline Model Portfolio.

Today’s Session

Financials act great ahead of the open, as big banks sans Citigroup (C ) hiked dividend payments and many also increased their buy-back programs.
 

Banks	New Dividend	Old Dividend
GS	$2	$1.25
JPM	$1.00	$0.90
BAC	$0.21	$0.18
WFC	$0.20	$0.10
MS	$0.70	$0.35
USB	$0.46	$0.42
STT	$0.57	$0.52
TFC	$0.48	$0.45
C	$0.51	----
BK	$0.34	$0.31
PNC	$1.25	$1.15

Beyond the banks, it’s a quiet morning. 

Comments

Anything can happen in CA, with a flack like Gav, steering the bus. Patrick J Pedley on 6/29/2021 10:23:00 AM

Thanks Charles. Quiet isn't all bad. Lorin K on 6/29/2021 12:06:43 PM

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