Quiet is the word this morning. There are no major economic reports on the calendar, no major earnings releases, and little in the way of volatility in overseas markets. China and Japan were basically flat overnight, most of Europe is little changed, and the yield on the 10-year Treasury is unchanged from yesterday. Even bitcoin is down just 4% after several days of 10%+ daily moves. The only major news headlines concern tariff threats (what else is new), but this time on European imports, and then talk that Saudi Aramco is looking to revive the IPO process.
Read today’s Morning Lineup to get caught up on news and stock specific events ahead of the trading day, as well as updated charts on the technical state of the market.
One indicator we track in order to asses the internal health of the market is the percentage of S&P 500 stocks hitting 52-week highs on a daily basis. In June, there were two days where the daily percentage of stocks hitting new highs clocked in at a healthy 20%, but in yesterday’s rally to new highs, the percentage of stocks that hit new highs only got as high as 11.9%, which is a relatively weak reading for a day when the S&P 500 breaks out to all-time highs. Going forward, we will be looking for stronger readings, especially on a positive market day like Monday.
In terms of the percentage of stocks in the ‘pipeline’ for new highs, the chart below summarizes where S&P 500 components finished yesterday relative to their 52-week highs. 20% of S&P 500 components are currently within 2% of a 52-week high (red bar), while another 21% are more than 2% but less than 5%, so on a strong market day there is certainly the potential for new highs to surge, but with futures indicating a slightly lower open, it’s unlikely we will see that surge today.
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