I really like the spunk exhibited by the market yesterday, which is a continuation of the last two weeks, where buyers materialized from time to time. The volume was still very light, but the market breadth looked fantastic. Once again, more new highs than lows on the New York Stock Exchange (NYSE) and the ratio markedly improved on the NASDAQ Composite. We also see more conviction via up-to-down volume ratios.

Market Breadth	NYSE	NASDAQ
Advancers	2,270	2,950
Decliners	1,029	1,760
New Highs	98	55
New Lows	66	180
Up Volume	3.07 billion	3.09 billion
Down Volume	1.29 billion	1.28 billion

• S&P 500: +0.95%
• NASDAQ Composite: +0.89%
• Dow Jones Industrials: +0.80%
• Russell 2000: +1.57%

Lots of bottom-fishing going on as the Russell 2000 growth enjoyed the largest rally.

Key Charts

Keep an eye on the Russell 2000, which closed right at the 50-day moving average, and a pivotal point that’s been support and resistance. The rally is on declining volume, but the Moving Average Convergence/Divergence (MACD) indicator trends are improving.

China technology is also coming on strong, as the KraneShares CSI China Internet ETF (KWEB) has cleared its 50-day moving average with ease and nearing a huge upside test at 40.00.

Sector Performance

Ten of eleven S&P 500 sectors were higher, led by Energy (XLE).

Mega-cap names continue to creep higher, which is impressive since the hot money crowd has moved onto XLE and Consumer Staples  (XLP) (said tongue in cheek).

Consumer Discretionary (XLY) continues to struggle, although consumers are stepping up with significant credit card spending: April +38.0 billion or 19.6% from $47.3 billion (revised from $52.4 billion), which  lifted revolving credit above the record level at the onset of the pandemic.

Keeping Up - Getting More Expensive

Yesterday in a presentation, Vasant Prabhu, Vice Chairman and CFO of Visa, talked up healthy credit card spending underscored by trends pointed out by Bank of America that sees negative durable goods spending against increased leisure spending from a year ago.

The Redbook weekly retail sales report continues to reflect a consumer paying big-time gasoline prices. It’s that extra cash Wall Street economists keep bragging about, but that stash is not as large as the “experts” say it is, and it’s dwindling.

Portfolio Approach

There are no sector weighting changes this morning.

Today’s Session

Anxiety abounds.  This is how we begin each session – lower and dare investors to make a move.  Meanwhile, investors spying higher bond yields are hanging back.

These circumstances and sessions are the perfect testing grounds for the market but are unpleasant (which makes them perfect).

Comments

Morning Team. We enjoy country living, thus, visiting Dallas for a few days allowed: Top Gun, Maverick in a great Dolby sound theater Dining in great restaurants Finding great gifts and home goods at Macys in the Galleria My takeaway is: spend wisely, enjoy time with friends and family and get out to support all your local businesses!! Becke Freitas on 6/8/2022 9:23:04 AM

Amen! Charles Payne on 6/8/2022 9:47:03 AM

I'm moving in with Kid Rock........... Pat Pedley on 6/8/2022 9:44:04 AM

Waiting on Friday's inflation number! Charles Haselberger on 6/8/2022 10:12:32 AM

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