The Closer – Big Tech Crushes Again, Steady Streaks, Consumer Confidence – 7/27/21

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Looking for deeper insight into markets?  In tonight’s Closer sent to Bespoke Institutional clients, we start out with a recap of a heavy slate of major earnings reports.  We then show the impressive streak that the S&P 500 has been on without a 5% pullback.  We then review today’s Consumer Confidence and preliminary durable goods numbers before closing with a recap of today’s 5-year note auction.

See today’s post-market Closer and everything else Bespoke publishes by starting a 14-day free trial to Bespoke Institutional today!

Bespoke’s Morning Lineup – 7/27/21 – Now the Fun Starts

See what’s driving market performance around the world in today’s Morning Lineup.  Bespoke’s Morning Lineup is the best way to start your trading day.  Read it now by starting a two-week trial to Bespoke Premium.  CLICK HERE to learn more and start your trial.

“Learn everyday, but especially from the experiences of others. It’s cheaper!” – John Bogle

Futures are indicated lower this morning as Chinese equities sink on continued fears of government crackdowns on that country’s tech sector.  We’ve seen a bit of a bounce off the lows, though, as we get closer to the opening bell in the US.  If that sounds familiar, it should since it was the exact same setup we had yesterday. While the issues in China are troubling for investments based in China, it should make US assets more attractive as capital flees that area of the world and looks for a safer home.

The week may have started off quietly yesterday, but the real fun begins today as there are not only a number of economic reports but some of the largest companies in the world will start releasing results.  In the case of economic data, Durable Goods came in weaker than expected, but last month’s release was revised higher which somewhat netted this month’s weakness out.  Later on today, we’ll get releases on Home Prices, Consumer Confidence, and the Richmond Fed Manufacturing sector.

On the earnings front, after the close, we’ll get reports from Alphabet (GOOGL), Apple (AAPL), and Microsoft (MSFT).  On a combined basis, these three companies alone are expected to report combined revenues of about $175 billion!  As if these three companies weren’t enough, we’ll also hear from Advanced Micro (AMD), Chubb (CB), Mondelez (MDLZ), Starbucks (SBUX), and Visa (V).

Read today’s Morning Lineup for a recap of all the major market news and events from around the world, the latest US and international COVID trends including our vaccination trackers, and much more.

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Yesterday was a big day for the crypto-currency markets, but Amazon’s denial that it would accept bitcoin payments by year-end has resulted in a giveback of some of those gains.  Bitcoin’s rally yesterday also coincidentally (or not) stalled out right at the same levels it stalled out at in mid-June, so for people to feel more comfortable going forward, they’ll likely want to see prices trade and stay above $40,000.

In the case of ethereum it’s a similar story as the rally in ether stalled out right near $2,400 which is right where it stalled out earlier this month.  The only difference between now and then is that while the last rally also failed at the 50-DMA, this time around, ether has still been able to hold above that level.

Bespoke’s Morning Lineup – 7/26/21 – Big Week for Earnings

See what’s driving market performance around the world in today’s Morning Lineup.  Bespoke’s Morning Lineup is the best way to start your trading day.  Read it now by starting a two-week free trial to Bespoke Premium.  CLICK HERE to learn more and start your free trial.

“When the facts change, I change my mind.” – John Maynard Keynes

Futures are lower to kick off the week, but it’s nothing like last Monday and we’re also well off the lows from earlier.  It’s a slow start, but we have a busy week of economic data ahead as well as a ton of earnings reports, and don’t forget about the FOMC meeting on Wednesday.

Read today’s Morning Lineup for a recap of all the major market news and events from around the world, the latest US and international COVID trends including our vaccination trackers, and much more.

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There’s an old sketch from Saturday Night Live called “Mr. Short Term Memory” where Tom Hanks plays a character with a disorder where he has a limited short-term memory.  As you might expect, the segment made for a few laughs when the character was in various situations like visiting a friend in the hospital or as a contestant on a game show.  Looking at the market last week, it appears as though Mr. Short Term Memory is a guiding force in the market.  Just a week ago, Dow futures were already down more than 500 points and the yield on the 10-year US Treasury was plummeting on concerns of rising COVID cases from the Delta variant.  By Tuesday, though, those concerns were all water under the bridge as all of the major US averages not only finished in the green for the week, but they were all up over 1% as well.

Leading the way higher, the Nasdaq 100 (QQQ) rallied nearly 3% putting the index nearly 7% above its 50-day moving average.  Even the Russell 2000 (IWM), which at one point on Monday was down over 10% from its record high, managed to finish the week up by more than 2%.  Despite the rally, though, most small and mid-cap indices remain below their 50-day moving averages.  However, despite all the commentary regarding the underperformance of small caps recently, they are still comfortably positive on the year, and besides IWM, there is a fairly strong degree of uniformity in YTD performance across the various market cap ranges.

The Bespoke Report – Stocks Immune To Delta Diagnosis

This week’s Bespoke Report newsletter is now available for members.

Stocks roared back to an all-time high close this week, shrugging off a surge in Delta variant cases in the US and around the world. We dive deep into earnings results that continue to run far ahead of analyst estimates, which have no doubt helped stocks recover from their slip last week. In addition to detailed analysis of how US earnings are rolling in, we review major reports from Europe this week as well as previewing major reports from both sides of the Atlantic next week. Fund flows continue to run at a shocking pace, driven by massive buying of bond funds and big inflows to equities too, while the longest commodity bear market in history continues despite 52 week highs for commodities this week. We discuss what high commodity prices mean for equities, as well as reviewing the recent slide in the crypto space. Finally, we review some big housing market data reports this week and take a look at which sectors of the economy are saving too much or too little. 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.

Bespoke’s Morning Lineup – 7/23/21 – In Like a Bear, Out Like a Bull

See what’s driving market performance around the world in today’s Morning Lineup.  Bespoke’s Morning Lineup is the best way to start your trading day.  Read it now by starting a two-week free trial to Bespoke Premium.  CLICK HERE to learn more and start your free trial.

“We don’t get paid for activity, just for being right. As to how long we’ll wait, we’ll wait indefinitely.” – Warren Buffett

What a difference a few days makes.  While the week started off with major concerns regarding the Delta variant, three straight positive days and an up morning in the futures market later, and the Delta variant is the last thing on investor’s minds.  Strong earnings in the social media space, as well as earnings from American Express (AXP), are pushing futures higher while disappointing results from Intel (INTC) and Boston Beer (SAM) have been set aside.  As far as the social media sector is concerned, the solid results from Snap (SNAP) and Twitter (TWTR) have pushed the market cap of SNAP up above $100 billion while Facebook (FB) now finds itself back in the trillion-dollar club.

Read today’s Morning Lineup for a recap of all the major market news and events from around the world, the latest US and international COVID trends including our vaccination trackers, and much more.

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As we head into the weekend, we wanted to provide a quick snapshot of some of the major US indices across various market cap ranges.  Starting at the low end, small caps plunged earlier this week to multi-month lows before regaining steam in the middle of the week.  On Thursday, the Russell 2000 was once again the notable laggard maintaining what has been a string of lower highs and lower lows for the last several weeks.  For now, the Summer weakness continues to be noise within a multi-month period of consolidation, but there has been increasing pressure on small caps.

Like small caps, mid-caps have also been laggards for the last several months.  As proxied by the S&P 400 Mid Cap Index, we have seen a steady string of lower highs and lower lows since its peak in late April.  The index is finishing the week well off its lows, but the downtrend remains in place.

Moving up to the market cap spectrum, large caps have been the area of most strength.  As shown by the Nasdaq 100 and S&P 500, both indices have patterns that are as far from downtrends as could be possible. In fact, if the current levels in the futures market hold, both of them will be close to all-time highs.

Bespoke’s Morning Lineup – 7/22/21 – Small Caps Bounce Big

See what’s driving market performance around the world in today’s Morning Lineup.  Bespoke’s Morning Lineup is the best way to start your trading day.  Read it now by starting a two-week free trial to Bespoke Premium.  CLICK HERE to learn more and start your free trial.

“If you don’t study any companies, you have the same success buying stocks as you do in a poker game if you bet without looking at your cards.” – Peter Lynch

The rally off of Monday afternoon’s low continues to roll on this morning as futures indicate modestly higher levels at the open.  There’s quite a bit of economic data coming up throughout the morning, so that will impact prices in the short term.  Jobless claims just came out and both initial and continuing claims came in well ahead of expectations.  After the close, we’ll have a number of high-profile earnings reports from companies like Boston Beer (SAM), Capital One (COF), Intel (INTC), Snap (SNAP), and Twitter (TWTR).

Read today’s Morning Lineup for a recap of all the major market news and events from around the world, the latest US and international COVID trends including our vaccination trackers, and much more.

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It’s been an eventful four days for the Russell 2000.  With declines of 1.2% on Friday and another drop of 1.5% Monday, the Russell 2000 came roaring back on Tuesday by surging 3%, erasing all of the declines from the prior two days.  On Wednesday, the small-cap benchmark followed up with an impressive encore by tacking on another 1.8%.

Despite all the fireworks lately, the moves in the Russell 2000 have been a lot of sound and fury signifying in particular.  As shown in the chart below, the Russell 2000 has been stuck in a sideways trading range since the beginning of February.  The key level to watch in the short-term for small caps is the 50-day moving average (DMA), which for the Russell 2000 ETF (IWM) stands at about $224.70.  If the index can break that level to the upside, it would be an encouraging signal, while a test and failure to take out that level would suggest more rough sledding ahead.