Monday, February 8, 2021 - DIA 313.89 +.75%, QQQ 333.58 +.67%, SPY 390.51 +.72%
No highly impactful data released. The S&P 500 (SPY) was led by the energy sector (XLE) 44.34 +4.18% & the financials (XLF) 31.29 +1.29%. The major averages continued to hit highs on the news backdrop of the 1.9T stimulus package and Treasury Secretary Yellen reiterating her support. As oil prices continued to firm at $57 for WTI, energy sector names popped; Marathon Oil (MRO) 8.98 +13.10%, and Occidental (OXY) 25.45 +12.81%, and Apache (APA) 17.84 +10.00% all outperformed. Recent crowdsourced speculative names like GameStop (GME) 60.00 -5.91%, and AMC Entertainment (AMC) 6.18 -9.52% continued to see selling pressure. In the Russell 3000 index, Clean Energy Fuels (CLNE) 17.87 +37.78% signed a deal to provide 47.5m gallons of renewable natural gas to the Los Angeles MTA.
Tuesday, February 9, 2021 – DIA 313.92 +.01%, QQQ 333.51 -.02%, SPY 390.25 -.07%
JOLTS Job Openings Survey came in lighter than expected 6.646M vs. 6.5M expected. The equity markets were in pause mode for most of the day as the Trump Impeachment got underway. The leading S&P 500 sectors were Real Estate (XLRE) 38.19 +.45%, and Communications (XLC) 71.93 +.33%, while Energy (XLE) 43.87 -1.06%, and Basic Materials (XLB) 73.59 -.74% both stalled. Chinese internet service companies surged on the day; NetEase (NTES) 132.42 +6.68%, Baidu (BIDU) 295.04 +6.67%. The huge winner on the day was Haines Celestial (HBI) 19.96 +24.91% which beat earnings handily as its turnaround strategy appeared to take hold. The speculative air continued to come out of Reddit names GameStop (GME) 50.31 -16.15%, and AMC Entertainment (AMC) 5.50 -11%.
Wednesday, February 10. 2021 – DIA 314.5 +.18%, QQQ 332.75 -.23%, SPY 390.08 -.04%
Consumer Prices ex-food & energy came in far better than expected posting 0% vs. +.2% expected. On a YoY basis +1.4% vs. 1.5%. The energy sector was the standout (XLE) 44.71 +1.91% as WTI crude settled above $58 a barrel. Tesla (TSLA) 804.82 -5.26% interestingly, appeared to trade in line with Bitcoin on the day after news the firm had acquired a $1.5B position in the digital currency and would accept it for payment. Twitter surged (TWTR) 67.77 +13.2% after reporting earnings that beat expectations, reporting brisk advertising sales and higher revenue than expected. Under Armor (UA) 18.76 +6.96% beat on earnings and revenues as well. On the downside, 3D printing machinery firm, The ExOne Company (XONE) 53.87 -16.48% priced a secondary offering of shares. Continuing its roller-coaster ride, Biotech company Cassava Sciences (SAVA) 49.29 -14.37% was down in a continued pullback from its meteoric rise.
Thursday, February 11, 2021 – DIA 314.68 +.06%, QQQ 334.58 +.55, SPY 390.71 +.16%
Continuing Jobless Claims came in higher than expected 4.545M vs. 4.49M. Initial jobless claims were significantly higher 793K vs. 757K expected. The equity markets were calm with results mostly coming in positive as earnings season ends. The rotation was evident among sectors. In the S&P, the technology sector was the leader (XLK) 137.88 +1.10% while energy showed weakness (XLE) 44.02 -1.54. Leading the Tech sector higher were the semi-equipment manufacturers KLA Corporation (KLAC) 324.48 +9.03%, Lam Research (LRCX) 572.21 +7.46% both pivoting up and out of support areas. Derm Tech Inc. (DMTK) 66.75 +25.82% continued an impressive run. (Note that the company's short interest is about 37% of the float, but the day’s average volume to cover is less than 2). On the downside, Nu Skin (NUS) 53.62 -14.74% beat on earnings but fell after the skincare company's guidance disappointed on the earnings call.
Friday, February 12, 2021 – DIA 315.04 +.11%, QQQ 336.45 +.56%, SPY 392.64 +.49%
The Michigan Consumer Sentiment Index disappointed & reported @ 76.2 vs. 80.8 expectation. Energy was the strongest sector (XLE) 44.67 +1.48%, followed by Basic Materials (XLB) 74.34 +1.03% & Financials (XLF) 31.52 +1.03%. The laggard sector was Utilities (XLU) 62.62 -.73%. The action in both the Financials and Utilities are highly influenced by interest rates. The 10-year government note index has doubled from .6% to 1.2% in the past 6 months. (In general, banks do better when short rates stay low and longer rates climb for a positively sloping yield curve, while Utilities are considered a fixed income alternative so when interest rates rise utility prices adjust lower). Intel (INTC) 61.81 +1.90% led the DJIA (DIA) followed by JPMorgan (JPM) 141.25 +1.42%. DNA sequencing and testing firm Ilumina (ILMN) 504.76 +11.87% reported better than expected earnings. Also, rallying was Home furnishings company Mohawk Industries (MHK) 169.28 +5.99% which reported and beat as well. On the downside, DaVita Healthcare (DVA) 104.99 -7.36% disappointed & continued its correction from January highs.
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