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Morning Commentary

CAN SMALL-CAPS COME UP BIG?

By Charles Payne, CEO & Principal Analyst
9/16/2021 9:44 AM

There was lots of green yesterday on the screen with gains evenly distributed across industries except Energy (which took off) and Utilities finished slightly in the red.

S&P 500 Index

+0.85%

 

Communication Services XLC

+0.49%

 

Consumer Discretionary XLY

+0.65%

 

Consumer Staples XLP

+0.36%

 

Energy XLE

+3.74%

 

Financials XLF

+0.96%

 

Health Care XLV

+0.65%

 

Industrials XLI

+1.10%

 

Materials XLB

+1.06%

 

Real Estate XLRE

+0.38%

 

Technology XLK

+0.88%

 

Utilities XLU

 

-0.13%

Market Breadth

Market breadth was better, although not extraordinary. And there were more new lows than highs on the NASDAQ Composite. Overall, the volume remains extraordinarily light. However, some would say   that’s a positive development in this environment as would-be sellers hold.

Market Breadth

NYSE

NASDAQ

Advancing

2,292

2,807

Declining

1,005

1,634

52 Week High

74

98

52 Week Low

48

111

Up Volume

2.79B

2.92B

Down Volume

1.23B

1.51B


Watching the Small-Caps

The Russell 2000 was the best performing large equity index, closing near the high of the session. It’s still range-bound, which means a breakout would be monumental.

Session Snapshot

High

Low

Close

S&P 500

4486

4438

4480

NASDAQ

15,174

14,984

15,161

Russell 2000

2236

2207

2234

 

Portfolio Approach

We added two names in Consumer Discretionary yesterday. This morning, we are adding one material name to our current buy list. Our cash is 5%.

Today’s Session

All major data releases coming in better than expected but initial jobless claims increased.

Retail Sales Drivers

Child Care Tax Credit = Headline

Chip Shortage = Electronics & Autos

Delta = Food at Home (groceries) vs Food Away from Home

August Monthly Sales Retail & Food Services

M/M

Y/Y

Headline

+0.7

+15.1

Motor Vehicle & Parts

-3.6

+10.7

                             Furniture                                

+3.7

+15.6

Electronics

-3.1

+18.1

Building Materials

+0.9

+6.3

Food & Beverage (at home)

+1.8

+5.7

Health & Personal Care

+0.2

+9.4

Gas Stations

+0.2

+35.7

Clothing

+0.1

+38.8

Sporting Goods

-2.7

+19.8

General Merchandise

+3.5

+15.5

Internet

+5.3

+7.5

Food & Beverage (away from home)

+0.0

+31.9

Lots of confusion out there, but overall, these were good developments.  I think the biggest news is the strong Philly Fed number. We will have more detail later today.


 

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