Aug 21, 2020
This week’s Bespoke Report newsletter is now available for members.
US large cap stocks continue to trend higher, even as small caps have retreated to support and other global equities have broken post-COVID uptrends to the downside. All is not lost, though, after an incredibly strong earnings season and with COVID retreating in the US…for now. This week we’re also watching the possibility of a double hurricane in the Gulf of Mexico, booming housing markets and the lumber they’re desperately bidding for, upticks in COVID case counts for a number of other countries, and booming e-commerce sales from major retailers. We discuss all these items in detail along with economic data in the US and around the world, new all-time highs for US stocks, and the outlook for Federal Reserve policy in this week’s Bespoke Report.
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Aug 14, 2020
This week’s Bespoke Report newsletter is now available for members.
Given the rotation we’ve seen into “re-open” areas of the market since July 20th, we can now confidently say that we’re in the midst of “Act IV” of the current bull market.
Below is our chart of the S&P 500 since last December highlighting what is now a four-act bull. Act I was the strongest and led by Tech, Health Care, and Energy. Act II saw huge gains from “re-open” plays as the first wave of COVID subsided. Act III saw sideways action for the broad market but big gains from Tech/FAANG as COVID cases began to rise again. And finally, Act IV has been led once again by re-open stocks in Industrials, Transports, and Financials, while the Tech sector and “COVID Economy” stocks have taken a breather.
We cover markets and the economy in much more detail in our weekly Bespoke Report newsletter. To read the report and access everything else Bespoke’s research platform has to offer, start a two-week free trial to one of our three membership levels. You won’t be disappointed!
Aug 7, 2020
This week’s Bespoke Report newsletter is now available for members.
As shown below in our ETF Asset Class Performance Matrix, August has by all accounts come in like a bull for equities.
Every single equity ETF with the exception of Brazil (EWZ) was up this week. Top-performing ETFs overall this week were Natural Gas (UNG) and Silver (SLV) which saw gains of over 15%.
In the US, every major index ETF was up over 2% this week as small caps led the way higher as IJR and IWM both rallied more than 5%. Despite this week’s outperformance, those two ETFs are still the worst performers YTD and since the February high for the S&P 500. The Nasdaq 100 was uncharacteristically a laggard this week gaining ‘only’ 2.05%. Converse to the small caps, though, this week’s underperformance didn’t put much of a dent in the Nasdaq 100’s lead in terms of performance YTD and since 2/19.
Investors who have been waiting for value to take the lead over growth saw things move ever so slightly in their favor this week as the value-oriented ETFs in each market cap range outperformed their global peers. It was only modest outperformance, but you have to start somewhere!
Cyclical sectors led the way this week as Industrials, Financials, and Energy were the top performers as defensive-oriented sectors like Health Care, Utilities, and Consumer Staples lagged.
We discuss this week’s action across markets in our weekly Bespoke Report newsletter, including a detailed look at election trends and the moves in commodities this week. To read the report and access everything else Bespoke’s research platform has to offer, start a two-week free trial to one of our three membership levels. You won’t be disappointed!
Jul 31, 2020
This week’s Bespoke Report newsletter is now available for members.
Just when they thought Tech was out, they pulled it back in!
Since peaking on July 20th, the Tech sector and FAANG names had been experiencing some downside mean reversion. That downside action came to an end on Friday when Apple (AAPL), Amazon (AMZN), and Facebook (FB) all surged on extremely impressive earnings results.
Below is one chart from this week’s Bespoke Report that shows the strength we’ve seen from the mega-caps in 2020. As shown, the five largest stocks in the S&P 500 have collectively added $1.66 trillion in market cap this year. The other 495 stocks in the index have lost $1.61 trillion in market cap!
We discuss this week’s action across financial markets in our weekly Bespoke Report newsletter. To read the report and access everything else Bespoke’s research platform has to offer, start a two-week free trial to one of our three membership levels. You won’t be disappointed!
Jul 24, 2020
This week’s Bespoke Report newsletter is now available for members.
In our Bespoke Report from two weeks ago, we broke the bull market rally off the March lows into three acts, each of which had different leadership characteristics. With the S&P 500 eclipsing its 6/8 high this past Monday, we have provided an update to the three act chart below, and now wonder if we are in the beginning of Act IV.
To summarize each of the acts so far:
Act I spanned 3/23 through 5/13 and was led by Tech and stay at home names which were either the least impacted or even benefitted from the economic shutdown and stay at home orders. Health Care stocks benefitted given the race for a vaccine and treatments, while bombed out Energy stocks bounced.
Act II spanned nearly a month beginning on 5/13 through 6/8. During this phase of the rally, the re-opening stocks rallied along with cyclicals in the Industrials sector as well as Financials as it became clear that the first wave of the Covid outbreak was ebbing.
Act III began in early June as signs emerged that the south and southwest was starting to flare up. As re-openings were rolled back, investors rotated back into tech, work from home, and FANG stocks.
That leaves us where we are now. With the S&P 500 reaching new post-Covid highs this week (before pulling back on Friday), is this the beginning of a new act, and if so, which areas will lead the market going forward? In this week’s Bespoke Report, we break down the latest trends regarding Covid, the market, earnings, and the economy in order to help answer that question. To read the report and access everything else Bespoke’s research platform has to offer, start a two-week free trial to one of our three membership levels. You won’t be disappointed!
Jul 17, 2020
This week’s Bespoke Report newsletter is now available for members.
The US equity market closed out this week right at the line in the sand that has snuffed out two prior attempts at sustaining the post-March rally. That sets up a huge next week as earnings reports start to really flow while the Federal Reserve debates yield curve control and Congress has to reckon with the expiry of large unemployment benefits which may threaten consumer spending. Meanwhile COVID continues to spread in the background, forcing a narrative reckoning across price and policy. We discuss in detail along with reviews of recent sentiment indicators, economic data, political polling, and the start of earnings season in this week’s Bespoke Report.
To read the report and access everything else Bespoke’s research platform has to offer, start a two-week free trial to one of our three membership levels. You won’t be disappointed!
