No, there’s no need to go restarting your machine or thinking your phone screen in broken, the Financials really are up over 1% today, and the S&P 500 Financial sector is having its best day since late April.  What’s rather encouraging about today’s move for the Financials is that the downtrend that has been in place for the sector since the highs earlier this year appears to have been broken.  Now if you’re screen is also showing green next to any Energy sector names, we would advise making an appointment at the genius bar!

In terms of stocks driving today’s move in the Financial sector, some of the biggest winners today have been the biggest losers since the sector peaked on 3/1.  The top part of the table below shows stocks in the sector that were down more than 5% between 3/1 and yesterday but are up 3%+ today.  The biggest winners are all banks with Regions (RF) and Citizens Financial (CFG) both up over 3.9%.  The only major brokerage firm to make the list is Morgan Stanley (MS) which has erased a good portion of it 7.5% decline with a 3.1% gain today.  On the downside, just three stocks in the Financial sector are down today and they are all stocks that were up from 3/1 through 6/7.  More broadly, of the 17 stocks in the Financial sector that were up from 3/1 through 6/7, the average gain today is just 0.77%.  Conversely, of the 48 stocks that were down from 3/1 through 6/7, the average gain today is over 2%.

After four straight weeks where jobless claims came in lower than forecast, we have now seen two straight weeks where jobless claims have disappointed to the upside.  Last week, claims came in 10K ahead of forecasts and today’s report showed claims coming in 5K higher than expected.  While economists were forecasting claims to fall back down to 240K, the actual reading came in at 245K, which was down 10K from last week’s reading of 255K.  Despite the higher than expected reading, claims have now been below 300K for 118 straight weeks.

Heading into last week’s report, we were expecting the four-week moving average to make a new cycle low, but the higher than expected reading quashed that plan, and with this week’s reading of 245K, it is unlikely that we will see a new low in claims anytime soon.  To get there, the four-week moving average would need to drop down to 235.5K from the current level of 242K.  That doesn’t sound like a lot, but in the next two week’s we will be dropping readings in the low 230K range, so the four-week moving average is likely to drift higher.

On a non-seasonally adjusted (NSA) basis, claims fell from 231.6K down to 212.2K.  For the current week of the year, this is more than 100K below the average going back to 2000 and the lowest for this specific week since 1974.

With everything seemingly okay in the equity world again after the major averages all hit new highs to close out last week, individual investors turned more bullish in the latest week.  According to the monthly survey from AAII, bullish sentiment increased from a very depressed level of 26.92% up to a five week high of 35.43%.  While it’s a far ways from a majority (a level we haven’t seen now in a record 127 straight weeks), this is the first time bulls have been in the plurality in five weeks.

Although bullish sentiment increased, bearish sentiment only saw a modest decline.  As shown in the chart below, negative sentiment declined by just two percentage points but did manage to fall back below 30%.  Also, that uptrend that had been in place since the lows in late 2015 appears to have been broken.

With bullish sentiment on the rise and bearish sentiment barely budging, the neutral camp really shrunk this week falling from above 40% down to 35%.