Daily Sector Snapshot — 8/1/23
B.I.G. Tips – Economic Zigs and Zags
Bespoke Stock Scores — 8/1/23
Chart of the Day – July Performance Drivers
$10 Trillion Added in Market Cap; 2023’s Best and Worst Through July
The US stock market (using the Russell 3,000 as a proxy) has now seen an increase in market cap of roughly $10 trillion from its bear market low last October through the end of July 2023. As shown below, the peak market cap for the US stock market was $51.5 trillion seen on the first day of 2022. From high to low, total US market cap fell $13.7 trillion during last year’s bear, but since then it has risen back up to $47.7 trillion. To get back to new all-time highs, total market cap would need to rise by roughly $3.8 trillion.
The average Russell 3,000 stock rose 5.74% in July. There were 813 stocks in the index that rose 10%+ in July, including 29 names that rose 50%+ which are listed in the table below. This list is made up of many of the high-fliers during the post-COVID bull that then got slaughtered during last year’s bear. Four names rose 100%: PolyMet Mining (PLM), Quantum-Si (QSI), UroGen Pharma (URGN), and Bridgebio Pharma (BBIO). Other notable names on the list of big July winners include Nikola (NKLA), Upstart (UPST), Carvana (CVNA), QuantumScape (QS), Rivian (RIVN), and Riot Platforms (RIOT). In case you haven’t been keeping track, Riot Platforms used to be Riot Blockchain, and before that, in early 2018 its name was Bioptix and it described itself as a company involved in developing new ways to test animals for disease.
Through July, the average Russell 3,000 stock was up 18.1% year-to-date. Below is a list of the 35 names that are already up 200%+ on the year. Topping the list is Carvana (CVNA) with a YTD gain of 869% after gaining 77.3% in July. Back in December 2022, CVNA had fallen into the $3s, but it’s now back up to the mid-$40s. Next up is Bit Digital (BTBT) with a YTD gain of 638%, followed by Cipher Mining (CIFR), IonQ (IONQ), Riot (RIOT), and Applied Digital (APLD). Similar to the list of July’s biggest winners, the biggest winners YTD are many of the names that got hit the hardest last year, with many falling more than 70% during their bear market drawdowns. Carvana, for example, was actually down 98% from its all-time high when it bottomed in 2022, so even after gaining more than 800% this year, it needs to gain another 700% from here to get back to new highs.
Have you tried out Bespoke’s premium equity market research yet? Take a look at our three membership levels below and then choose a checkout link to start a one-month trial for $1 today!
Bespoke Newsletter — one month trial for $1 then $395/year
Bespoke Premium — one month trial for $1 then $99/month
Bespoke Institutional — one month trial for $1 then $195/month
Bespoke Market Calendar — August 2023
Please click the image below to view our August 2023 market calendar. This calendar includes the S&P 500’s historical average percentage change and average intraday chart pattern for each trading day during the upcoming month. It also includes market holidays and options expiration dates plus the dates of key economic indicator releases. Click here to view Bespoke’s premium membership options.
Key ETF Performance Through July 2023
The S&P 500-tracking ETF (SPY) finished July up 3.27%, leaving it up 20.62% YTD on a total return basis. The mega-cap Tech-heavy Nasdaq 100 (QQQ) gained only slightly more than SPY in July, but it’s up more than twice as much as SPY on a YTD basis at +44.5%. The small-cap Russell 2,000 (IWM) did better than large-caps and mid-caps in July with a gain of 6.11%, but IWM is up less than large-caps on a YTD basis at +14.7%. Value and dividend stocks held up well in July and actually outperformed growth for the month, but value is lagging YTD and the DJ Dividend ETF (DVY) is actually down 0.5% on the year.
Looking at US sectors, Energy (XLE) and Financials (XLF) — which lagged in the first half of 2023 — did the best in July, while Health Care (XLV) and Real Estate (XLRE) were up the least. Technology (XLK) and Communication Services (XLC) are currently neck and neck on a YTD basis with XLK up 43.94% through July and XLC up just three basis points more at 43.97%.
Outside of the US, we saw China (ASHR) and Israel (EIS) gain the most in July, while France (EWQ) and Spain (EWP) gained the least. YTD, it’s Mexico (EWW) that’s currently atop the list of country ETFs with a gain of 42.85%.
Oil (USO) gained 15%+ in July, while natural gas (UNG) fell 4.2%. Gold (GLD) saw a small monthly gain of 2.3% versus a gain of 8.6% for silver (SLV). Finally, with yields rising again during the month, Treasury ETFs were in the red. Aside from natural gas, the 20+ Year Treasury ETF (TLT) is down more than any other asset class in our matrix on a YoY basis with a total return of -12.3%.
Have you tried out Bespoke’s premium equity market research yet? Take a look at our three membership levels below and then choose a checkout link to start a one-month trial for $1 today!
Bespoke Newsletter — one month trial for $1 then $395/year
Bespoke Premium — one month trial for $1 then $99/month
Bespoke Institutional — one month trial for $1 then $195/month
Bespoke’s Morning Lineup – 8/1/23 – Touch of Red
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.
“Live life expecting the worst, hoping for the best, and living for the future” – Jerry Garcia
Below is a snippet of content from today’s Morning Lineup for Bespoke Premium members. Start a two-week trial to Bespoke Premium now to access the full report.
As if on cue, the calendar flipped to August and futures are pointing to a lower open this morning. Things started off well enough overnight in Asia where Japan, South Korea, and Australia all traded higher, but Europe picked up the baton and has headed south since the open. The catalyst for weakness there has been some lackluster manufacturing PMI data, but at this point the declines are relatively modest. While the headline PMI reading for the Eurozone was right in line with expectations, it remained deep in contractionary territory at 42.7.
In the US today, the focus remains on earnings, but fifteen minutes after the opening bell, we’ll get the S&P US Manufacturing PMI followed by Construction Spending, ISM Manufacturing, and JOLTS at 10 AM.
With a rally of over 28% from its bear market lows in late 2022, equities have really come a long way in a short period of time, but if you widen out your view from the extreme lows of last year and look on a calendar basis, the gains don’t look quite as impressive. In the case of the S&P 500, over the last 12 months, it’s still up over 11%, but on a two-year basis, performance looks much less attractive at just 4.4%. That hardly looks like a market that has become unanchored from reality.
The Nasdaq is a similar picture. It has rallied more than 40% from its bear market lows and is up nearly 16% over the last year. Over the last two years, though? Down 2.2%.
Lastly, the Russell 2000. It’s been a laggard off the lows and over the last year as well with gains of 21.4% and 6.3%, respectively. The two-year performance looks downright depressing with a decline of 10%. When you have big gains in a short period of time, yet longer-term returns are still flat to down, all you can say is “What a long strange trip it’s been.”
Start a two-week trial to Bespoke Premium to read today’s full Morning Lineup.
The Closer – Big Refunding, SLOOS, Five Fed, LatAm Rate Cycle, Positioning – 7/31/23
Log-in here if you’re a member with access to the Closer.
Looking for deeper insight into markets? In tonight’s Closer sent to Bespoke Institutional clients, we start out with a review of the latest earnings reports (page 1) followed by a look into the latest SLOOS data (pages 2 – 4). We then dive into a review of Latin American policy rates (page 5). We next provide a final recap of our Five Fed Manufacturing Composite (page 6) then close out with the latest positioning data (pages 7-9).
See today’s full post-market Closer and everything else Bespoke publishes by starting a 14-day trial to Bespoke Institutional today!