Wall Street Strategies
Hello! Sign in or Register


Morning Commentary

TEST OF THE MIGHTIEST STOCKS †

By Charles Payne, CEO & Principal Analyst
9/30/2021 9:37 AM

It’s never how the market opens; it’s how it closes. And for the second consecutive session yesterday, the inability to lure buyers off the sidelines saw the rally attempts fizzle. There were more new lows and down volume for the NYSE and the NASDAQ Composite.

There was a flight to traditional safety, which powered the defense sectors to the front of the pack.  Interestingly, Materials joined growth sectors (Communication Services and Tech), perhaps reflecting doubt about the infrastructure bill squeaking through. However, I think it’s clear it has to pass before that gargantuan “social welfare” spending bill.

Market Breadth

NYSE

NASDAQ

Advancing

1,906

1,855

Declining

1,418

2,603

52 Week High

57

59

52 Week Low

68

168

Up Volume

1.59B

2.31B

Down Volume

1.77B

2.60B

 

S&P 500 Index

+0.16%

 

Communication Services XLC

 

-0.09%

Consumer Discretionary XLY

+0.10%

 

Consumer Staples XLP

+0.91%

 

Energy XLE

0.00%

 

Financials XLF

+0.08%

 

Health Care XLV

+0.84%

 

Industrials XLI

+0.11%

 

Materials XLB

 

-0.41%

Real Estate XLRE

+0.65%

 

Technology XLK

 

-0.14%

Utilities XLU

+1.45%

 

Fed Talking Head Parade

Washington, D.C. Follies have not confided in Congress because Federal Reserve members are all over the place trying to soothe nerves and, perhaps some are auditioning for the top job (now or in the future).

Powell Highlights

Inflation

Balance Sheets

FRED Graph

Corporate Assets 

06-2021

03-2021

12-2020

09-2020

06-2020

Cash & Cash Equivalents

5,221,000

4,518,000

4,122,000

3,168,000

2,684,000

Receivables

1,421,000

1,509,000

1,593,000

1,427,000

1,557,000

TOTAL

$6,932,000

$6,306,000

$5,988,000

$4,841,000

$4,459,000

San Francisco Fed President Mary Daly

Tapering

Jobs

Rates

Social Justice

Inflation 

Comments:

Daly’s comments that inflation could be moderating is interesting. Sherwin-Williams (SHW) was poised to be the biggest decliner on the session on supply chain woes. But it climbed off the lows to close higher. So, perhaps the Street is seeing beyond supply chain and inflation issues.

Who Will Challenge Zodiac Capital Limited (ZOD:AU)?

The mighty NASDAQ-100 is under more pressure than it’s accustomed to, and the internals are breaking down as only 24% of its components are trading above their 50-day moving average.

Nasdaq 100 vs % of Nasdaq 100 Stocks Above 50-Day Moving Average

The NASDAQ Composite failed to hold onto two separate rallies closing near the trendline.

Portfolio Approach

There are no weighting changes this morning in our Hotline Model Portfolio.

Today’s Session

The government will stay open until December 3, but there probably will not be a vote on infrastructure.  Meanwhile, the parade of Fed speakers continues, and at any time, their words could nudge the market.

John Williams Speaks

10:00 AM

Raphael Bostic Speaks

11:00 AM

Patrick Harker Speaks

11:30 AM

Charles Evans Speaks

12:30 PM

James Bullard Speaks

1:05 PM

Mary Daly Speaks

2:30 PM

How To Get Economy in Gear & Live with Covid?

Initial Jobless Claims are up for the third straight week missing consensus in each of those weeks and now at the highest level since the first week of August.   Something is wrong.  I think this gets back to actions being taken to combat Covid19 and whether there is a better balance between safety, economic progress and common sense.

United States Initial Jobless Claims

Consider this story out of NYC that saw vaccine passports and mandates backfire anyway as the cast of the play Aladdin saw breakthrough cases.

Covid cancels 'Aladdin' one day after Broadway reopening

Producers of the musical, which closed along with the rest of Broadway in March 2020, said breakthrough cases were detected in the company.

https://www.nbcnews.com/news/us-news/covid-closes-aladdin-one-day-after-broadway-reopening-n1280391

New York City requires proof of vaccination to attend many indoor venues, including theaters, and staff members must also be vaccinated. The Broadway League trade group has also said all 41 theaters are requiring audiences, crew members and performers to be vaccinated.

Breakthrough cases refer to people who contract Covid-19 after having been vaccinated. Health experts say that such cases are expected but that the risk of getting severely ill or dying is much lower among those who are vaccinated.

Good start this morning, but lots of bombs, including CarMax (KMX), which blew away revenue but missed big on earnings.  The stock is in the model portfolio, as we anticipate demand to remain strong even as consumers are forced to pause for a variety of reasons.  This is the tough calculus.


Comments
I have a relative in Broadway that has recovered from Covid and has very strong antibody levels every time they get the test. This person also has some other health considerations and does not want to get the vaccine. However, the producer is requiring everyone to get the vaccine. So in order to work this person has to compromise what they think is right for their own health. So ridiculous how a mandate is for every one and we are all individuals.

Christiana on 9/30/2021 1:55:00 PM
 

Log In To Add Your Comment


Home | Products & Services | Education | In The Media | Help | About Us |
Disclaimer | Privacy Policy | Terms of Use |
All Rights Reserved.