Morning Commentary
Yesterday, the S&P 500 traded in a very tight range all session, bouncing from small gains to small losses before settling fractionally lower. The session was doomed when Goldman Sachs (GS) laid that giant egg, but the chart formation was beckoning. The reverse head and shoulders formation is a reliable bullish formation.
It was an eclectic leadership board with Elon Musk riding high at the top.
Heat Map
The Heat Map was more crimson than most sessions this year, with Tesla (TSLA) standing way out from the crowd.
And only four sectors were higher on the session, but Technology (XLK) was at the top of the list.
Chips Ahoy
VanEck Vectors Semiconductors ETF (SMH) was the best-performing industry group inside the Technology (XLK) sector. The SMTF has rallied seven straight sessions.
Longer-term, SMH climbed above the key trendline that was resistance and held as support. There is a lot of room from this point to the next test of resistance.
Lots of Economic Data
There is a ton of economic data out today. The Producer Price Index (PPI) might be the most influential, but all the data is relevant. It’s going to be interesting to see reactions to data that come in below the consensus estimates. Will bad news be good news?
Retail Sales
Yesterday, the CFO at Goldman Sachs said they're seeing early signs of consumer credit deterioration. At the same time, excess savings is fading quickly.
Portfolio Approach
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Today’ Session
Retail sales -1.1% month to month, missing consensus by -0.9%.
Nominal +5.2% from a year ago, but when adjusted for inflation -1.2%.
In nominal numbers, only three sectors saw gains.
But when adjusted for inflation, we still spent lot of money on at gas stations, general merchandise and hobby stores.
PPI
Producer prices came in below consensus across the board with the monthly decline -0.5%, the biggest since April 2020.
Before data releases
The street was looking for two rate hikes and later two rate cuts before this morning’s data – we’ll keep watching.
Meanwhile, the Ten-Year bond yield at very critical support point at 3.40%
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1/30/2023 1:44 PM | Busy Week |
1/30/2023 9:26 AM | BIGGEST TEST |
1/27/2023 1:48 PM | Testing 2023 Rally |
1/27/2023 9:34 AM | ON THE DOORSTEP |
1/26/2023 1:09 PM | Backing and Filling |
1/26/2023 9:35 AM | ARE THE ANIMALS BACK? |
1/25/2023 1:01 PM | Not That Bad |
1/25/2023 9:57 AM | SPUNKY MARKET NEEDS BOOST |
1/24/2023 1:09 PM | Recession, Soft Landing Debate |
1/24/2023 9:52 AM | RALLY ON TIGHTROPE |
1/23/2023 1:55 PM | Nasdaq Leads |
1/23/2023 9:48 AM | LOOKING MUCH BETTER |
1/20/2023 1:39 PM | Netflix Rallies |
1/20/2023 1:39 PM | Netflix Rallies |
1/20/2023 9:44 AM | GLIMMER OF HOPE |
1/19/2023 1:17 PM | Slow Our Roll |
1/19/2023 9:42 AM | TRAPDOOR |
1/18/2023 1:11 PM | Careful What Your Root For |
1/18/2023 9:43 AM | HELD BACK BY GOLDMAN |
1/17/2023 1:58 PM | Focus on Earnings |
1/17/2023 9:50 AM | MONSTER START – CAN IT CONTINUE? |
1/13/2023 1:36 PM | Showing Resilience |
1/13/2023 9:28 AM | FRIDAY THE 13TH - FEAR THE FED |
1/12/2023 1:42 PM | Chopfest |
1/12/2023 10:03 AM | HOPE SPRINGS ETERNAL |
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