Make it ‘Eight.’

The S&P 500 has closed higher for eight consecutive sessions, making it the tenth time since 1998 that such a streak has been put together.

Highlights of the streak:

• 71 stocks >10%
• Nvidia (NVDA) +27%
• Super Micro Computer Inc (SMCI) +25%
• Starbucks (SBUX) +23%
• Micron Technology (MU) +23%

Yesterday, Technology (XLK) and Communication Services (XLC) rallied 1.44%, but the semiconductor subsector surged more than 3%.

Chase & Fish

In addition to chasing mega-cap Tech and semiconductors, investors continue to kick the tires of the biggest losers (Albemarle (ALB) and Lamb Weston Holdings (LW)), thinking the damage has been overdone.

It's How You Finish

The most compelling part of the session was the surge of buying into the closing bell. Fence-sitters must be beside themselves; many are chasing late in the session.

Spreading the Love

Now, 72% of the S&P 500 is changing hands, above its 50-day moving average.

There is lots of green on the screen.

Does The Market Smell 50 BPS?

Yesterday, the July Leading Economic Index (LEI) came in worse than expected.

The Street braced for -0.4% but saw -0.6%, instead of -0.4% in the prior month. The Street has stopped paying attention to the LEI and the inverted yield curve, the two most reliable proxies for an impending recession.

But don’t dismiss the messaging embedded in the LEI:

• Weak housing
• Weak weekly hours/pay
• Weak Consumer expectations

Evercore ISI thinks the Fed will cut 50 basis points (bps) out of the gate, and I think that would be smart. Perhaps the market may be sensing this as well.

Today’s Session

Quiet morning as the stock market looks for fresh catalysts, understanding that momentum isn’t long-lasting rocket fuel.

As new highs continue to emerge, the cap-weighted S&P is still on its way.  However, the equal-weight S&P 500 has just reached a fresh high, a significant event that is sure to pique the interest of investors.

A lot is being made of equal weight at its all-time high (ATH), while cap weight is in the shadow of such a milestone. Keep in mind that the latter has almost doubled the performance of the former this year.

There is a chance the Fed minutes could move the market later today.

For now, bias is still to the upside.

Comments

Inflation is still hanging at 3% - no Rate Cut M2 is stable - no Rate Cut 10yr has dropped a full 1% doing the Fed work - no Rate Cut Consumer is stretched, but still employed in mass - no rate cut If Powell listens to the "TV Talking Heads", he will become just another follower. That is not his role, is it? to be a follower? FRITZ E PIEPER on 8/20/2024 12:13:43 PM

Tweet

 

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