This week was another ugly one for jobless claims, although the weekly trend is moving in the right direction.  While the 2.981 million print was significantly higher than estimates of 2.5 million, this week marked the sixth in a row that claims were down week-over-week. This week also marked the first sub-3 million print and the lowest number since claims first spiked in the week ending March 20th. While the slowed pace of claims is an improvement, this was a smaller WoW decline compared to the past several weeks.  Additionally, with another 2.981 million added this week, the grand total of jobless claims since that March 20th print now sits at nearly 36.5 million, or roughly 11% of the entire US population.

As shown in the chart below, the streak of WoW declines over the past six weeks is now tied for the second longest such streak on record.  Back in 2016, 2009, 1994, and 1993 were the last times that claims had fallen for six straight weeks, and there have only been two other periods where claims fell for longer: 2013 and another in 1980.  Both of those streaks ended at seven weeks.

As for non-seasonally adjusted claims the same story holds true. The drop to 2.614 million this week was the fifth consecutive weekly decline and the lowest print since the initial spike in claims in late March.

With another lower print, the four-week moving average has also continued to decline.  That measure has now declined for three straight weeks to its current level of 3.617 million. Start a two-week free trial to Bespoke Institutional to access our interactive economic indicators monitor and much more.

What started out as a weak open for equities today started to show improvement early on.  Just an hour after the open the S&P 500 was even up for a few minutes, but then the President sent out a tweet where he argued that “dealing with China is a very expensive thing to do.”  He then went on to say that “100 Trade Deals wouldn’t make up the difference” for the “Plague from China.” The timing of this tweet was especially concerning as it comes just two days before the expiration of a 90-day enforcement provision of the trade deal on Friday. With that tweet, the equity market’s rally was stopped dead in its tracks as the S&P 500 sold-off for the rest of the morning.

By noon, the market was attempting to bounce, but then David Tepper came on CNBC to say that the current market was one of the most overvalued he has ever seen.  That stopped any chance of a rebound and within minutes, the S&P 500 was at its lows of the day.  Ever since then, the market has been trading sideways all afternoon, but with 45 minutes left in the trading day, we’ll see if those lunchtime lows can hold.  Between Druckenmiller after the close yesterday, Trump this morning, and then Tepper at lunch, you can’t fault the market for acting a little punch drunk.  Start a two-week free trial to Bespoke Institutional for full access to our research and interactive tools.

Over the past year and a half, gold has been on the up and up though it was interrupted by the string of volatility from the recent Covid crash across asset classes. In the past few months, the SPDR Gold Trust ETF (GLD) fell 12.5% from its March 9th high to March 19th low, which was followed by an 18.33% rally off that low to its last closing high on April 23rd.

Since its April high, GLD has been consolidating with a set of higher lows and lower highs between roughly $158 and $163. This is a flag pattern that suggests a breakout is coming either to the upside or the downside.  For now it’s closer to breaking out to the upside as it tests the top end of the flag’s range.  Start a two-week free trial to Bespoke’s premium research platform to access a full range of equity analysis and interactive tools.

Currently, the only two sectors that are trading in overbought territory (1+ standard deviations above its 50-DMA) in our Trend Analyzer are Technology and Communication Services.  Meanwhile, Financials, Industrials, Utilities and Real Estate are all closer to oversold territory than overbought without any of those sectors yet to have even moved above their 50-DMAs.

As for short-term breadth levels as measured by the 10-day advance/decline line, as shown in the charts from our Daily Sector Snapshot below, those same sectors in addition to Consumer Discretionary and Materials have actually begun to touch oversold levels after the late day reversal lower yesterday and a lack of a push higher with lackluster breadth over the prior few days.

Even the sectors that have been market leaders like Health Care, Communication Services, and Tech have more neutral 10-day A/D line readings at the moment even with prices at or near overbought levels.  Start a two-week free trial to Bespoke Institutional to access our Daily and Weekly Sector Snapshots and much more.

In last night’s Closer, we noted that as of yesterday’s close, the S&P 500 (SPY) sat over 15% away from its 2/19 all time high. But as for the index’s individual stocks, about 12.4% have retaken their 2/19 levels.  As shown in the chart below, Health Care sector stocks on average are the closest at 5.29% below their levels on 2/19.  Consumer Staples are the only other stocks that are less than 10% away from those levels on an average basis.  Conversely, Energy, Financials, and Real Estate have the furthest to go, all down around 30% or more.

Meanwhile taking a look across industries, there is only one group of stocks that’s currently above its 2/19 levels on an average basis: Pharmaceuticals, Biotechnology, & Life Sciences.  While stocks of that industry have pushed above by 1.2% on average, the other groups are not even close with the next closest to doing so being Food & Staples Retailing at 7.6% below 2/19 levels. In addition to Food & Staples Retailing, Food, Beverage, & Tobacco, and Health Care Equipment & Services are the only others that are even within 10% away.  On the other end of the spectrum, Banks, Energy, and Consumer Durables  & Apparel are down the most.

Those same dynamics can be seen in the table below of the stocks furthest above and below their 2/19 levels.  While Health Care stocks like Dexcom (DXCM) and Regeneron (REGN) have surged over 40% since 2/19, some of the biggest losers during the sell off remain beaten down.  Of the 20 stocks that are furthest below their 2/19 levels, most have something to do with oil, planes, cruises, or retail stores. Start a two-week free trial to Bespoke Institutional to access our Closer and much more.