Mar 10, 2021
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.
“The first panacea for a mismanaged nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunists.” – Ernest Hemingway
Nothing like a quote on the perils of inflation for a day when inflation is on everyone’s mind in the wake of recent market performance and today’s release of the February CPI. Equity futures were modestly higher heading into the release, treasury yields are higher, and bitcoin is above $55K. With the report coming in right in line with expectations at the headline level and slightly weaker than expected ex-food and energy, the positive tone looks to be continuing. We would stress, though, that this is only the initial reaction. There’s lots of time left in the day and even to the opening bell!
Be sure to check out today’s Morning Lineup for updates on the latest market news and events, including a recap of Asian and European markets, French manufacturing output, credit growth and inflation in China, an update on the latest national and international COVID trends, including our series of charts tracking vaccinations, and much more.
After Tuesday’s surge in the Nasdaq and strong rally in the S&P 500, US equities are back in the black for the week, but in many ways, the stocks that led the rally on Tuesday were the exact opposite of the ones that outperformed on Monday. For starters, within the entire Russell 1000, there were only 36 stocks that outperformed the index by more than 1% on both days.
The decile performance of stocks in the Russell 1000 on Tuesday based on their performance Monday also illustrates this trend. As shown in the chart below, the five deciles of top performers Monday all averaged declines on Tuesday, while the five deciles comprising the worst-performing stocks from Monday all saw positive returns on Tuesday. Outside of decile one which was only down slightly less than decile two, the performance rankings of the ten deciles on Monday versus Tuesday was a complete reversal. As noted in the Bible, “the last shall be first, and the first last:”
Mar 9, 2021
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.
“There are no facts, only interpretations.” – Friedrich Nietzsche
The Nasdaq is looking to brush the dust off its shoulders after a major beatdown in the high growth area of technology to kick off the week yesterday. S&P 500 futures are also up nearly one percent as the DJIA lags. For now, fixed income markets are cooperating as yields pull back, but we’ll see if these levels can hold throughout the trading day.
Be sure to check out today’s Morning Lineup for updates on the latest market news and events, including revised OECD economic forecasts, trading in overseas markets, Japanese economic data, an update on the latest national and international COVID trends, including our series of charts tracking vaccinations, and much more.
Yesterday was another wild day in the stock market. Depending on your perspective and your benchmark, it was either a good day or a bad day. From the perspective of the DJIA, which was up 0.97%, the week didn’t start off all that bad, but for an investor who follows the Nasdaq, this week started off much differently with a decline of 2.4%.
That kind of divergence where the DJIA is up and the Nasdaq drops over 2% on the same day is pretty uncommon. The charts below show the performance of both indices going back to 1986, and in each one, we have included red dots to show all the occurrences where the DJIA was up and the Nasdaq was down over 2%.
In this span, every prior occurrence was confined to three separate periods. While there were two separate occurrences right after the 1987 crash, there wasn’t another until 1999, when there were three between April and June. After that, the frequency of occurrences really picked up as there were 23 in 2000 and another 7 in 2011. After that, the two indices went nearly another 20 years until July 2020 without any similar occurrences, and now this year, there have been two since 2/22.
Mar 8, 2021
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.
“Even a mistake may turn out to be the one thing necessary to a worthwhile achievement.” – Henry Ford
It’s looking like more pain may be in store for tech stocks to start the week as Nasdaq futures are trading down by more than 1%. As bad as that sounds, things were worse about a half-hour ago before comments from David Tepper through CNBC where he said he doesn’t see rates rising in the short-term and that therefore, equities look attractive.
Be sure to check out today’s Morning Lineup for updates on the latest market news and events, the passage of the COVID relief bill, Chinese trade data, an update on the latest national and international COVID trends, including our series of charts tracking vaccinations, and much more.
Last week was a painful one for the Nasdaq 100, but for the majority of other US indices, last week was a positive one with the DJIA up over 1% while the S&P 500 was up just shy of 1%. Following a month-long period of consolidation, all but two of the indices in our Trend Analyzer currently have good timing scores.
Mar 5, 2021
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.
“You must not only learn to live with tension, you must seek it out. You must learn to thrive on stress.” – J. Paul Getty
Thankfully, it’s Friday. After another week of declines for equities, futures were modestly positive this morning, but that changed with the release of the February employment report. The bond market was already showing some signs of concern heading into the release, and those concerns look to have been warranted as the headline number came in well above forecasts (379K vs 200K). In reaction to the report, the 10-year yield has risen from a pre-release level of 1.58% to 1.62% now.
Be sure to check out today’s Morning Lineup for updates on the latest market news and events, movements in the Japanese bond market, German factory orders, an update on the latest national and international COVID trends, including our series of charts tracking vaccinations, and much more.
Normally, when the equity market comes under selling pressure bonds rally providing some level of cushion to a diversified portfolio. In the last few weeks, though, that still hasn’t been the case. The chart below is from the second page of the Morning Lineup and shows the relative strength of the S&P 500 versus the US Treasury Long Bond Future. In an environment like the last couple of weeks where stocks have been weak, you would expect the relative strength line of the S&P 500 to decline, but so far during this pullback that hasn’t been the case. Despite a 4.6% pullback in the S&P 500, its relative strength versus the Long bond Future remains near 52-week highs.
Mar 4, 2021
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.
“The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself.” – George Bernard Shaw
After a strong start to March, major US equity indices have given up all or most of those gains in the last two days. Based on where futures are trading now, today may mark a third step backward for the equity market, although not to the same degree as the last two days. Treasury yields, which have been the tail wagging the market lately, are lower this morning with the 10-year US Treasury yield trading right around 1.45%. The economic calendar is jammed packed with Non-Farm Productivity (weaker than expected), Unit Labor Costs (weaker than expected), and Jobless Claims (in line with forecasts) just crossing. Then at 10 AM, we’ll get Durable Goods and Factory Orders at 10 AM. Fed Chair Powell will also be speaking just after noon.
Be sure to check out today’s Morning Lineup for updates on the latest market news and events, some earnings reports from the US and around the world, an update on Eurozone labor markets, an update on the latest national and international COVID trends, including our series of charts tracking vaccinations, and much more.
The Technology sector closed below its 50-day moving average again yesterday, and while many tech stocks have been getting slammed of late, the sector is down less than 7% from its closing high in February. The chart of the sector lately looks a bit ominous though. If you squint enough, you can see what looks like a head and shoulders pattern forming over the last several weeks with the neckline also coinciding with the highs from early September. If that breaks, this March, which came in like a bull (briefly), would likely be filled with more bear.
The Energy sector has been a completely different story. The sector remains right near 52-week highs after recently breaking above resistance from its June post-COVID high.
Given the diverging paths of the two sectors, the performance spread between the two sectors over the last six months now stands at 35.3 percentage points, which is the widest margin of underperformance for the Technology sector relative to Energy in nearly 20 years!
Given the diverging paths of the two sectors, the performance spread between the two sectors over the last six months now stands at 35.3 percentage points, which is the widest margin of underperformance for the Technology sector relative to Energy in nearly 20 years!
Mar 3, 2021
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.
“I went looking for trouble, and I found it.” – Charles Ponzi
Markets are looking to make an attempt to rebound from yesterday’s weakness, but the effort hasn’t been all that inspiring to this point as futures have erased more than half of their gains. If the inability of futures to hold on to their gains isn’t enough, today also marks the birthday of Charles Ponzi!
ADP Private Payrolls were just reported and missed expectations by nearly half (117K vs 225K). The big report of focus for the remainder of the day will be the ISM Services report at 10 AM.
Be sure to check out today’s Morning Lineup for updates on the latest market news and events, some earnings reports from the US and around the world, an update on Markit PMI readings for the Services sector, an update on the latest national and international COVID trends, including our series of charts tracking vaccinations, and much more.
US equities opened higher yesterday but sold off from the opening bell right until the close in what can only be described as a disappointing session for bulls. Below we show intraday charts of the S&P 500 and Nasdaq over the last 15 trading days, and what you can also see in both charts is that their opening prints also coincided with downtrend lines that have been established from the index highs in mid-February. At this point, the burden of proof is on the bulls to break these downtrends. Based on where futures are trading now, neither of these trends will come into play at the opening bell, but if the markets can build on their early gains, a test could come into play. Stay tuned!
